Safe withdrawal rate

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The sum of money that can be withdrawn from a portfolio of investments with a zero failure rate given a fixed number of years. It is usually expressed as a percentage.

Monte Carlo simulations of historical US stock market returns over the past 100+ years show that 4% has been a safe withdrawal rate given a time horizon of 30 years for a 100% stock portfolio within the backtesting period. Recent research using data sources from other countries suggests that the US has had above average returns compared to all other countries. Since this performance is unlikely to be repeated, it casts doubt on the 4% number[1].

You can run your own Monte Carlo simulation using FireCALC (


Are safe withdrawal rates really safe