A retirement rule of thumb from the Trinity Study: withdraw 4% of your portfolio in year one, adjust for inflation each year after, and a diversified portfolio has historically lasted 30+ years. It's why your FIRE number is roughly 25x annual spending.

Is the 4% rule safe for early retirement?

For retirements longer than 30 years, many planners suggest 3.25-3.5% instead, or staying flexible: spending a little less in down markets dramatically improves success rates.

How much can I withdraw from $1 million?

At 4%, $40,000 in the first year (about $3,333/month), adjusted for inflation each year afterwards. At 3.5% it's $35,000; at 5% it's $50,000 with higher risk of running out.

4% Rule Calculator (2026) — Safe Withdrawal From Your Portfolio

What is the 4% rule?

The 4% rule comes from the Trinity Study, which tested how long a diversified stock/bond portfolio would have survived every historical retirement since 1926. Withdrawing 4% of the starting balance in year one, then adjusting that amount for inflation every year, a portfolio lasted at least 30 years in the vast majority of historical periods.

It's the reason the FIRE community talks about needing 25× your annual spending: 1 ÷ 4% = 25. Spend $40,000 a year and your FIRE number is $1,000,000.

What $1,000,000 pays in year one. The 4% rule is the benchmark; lower rates buy safety for longer retirements.

The rule is a planning benchmark, not an autopilot. Real retirees flex: skipping an inflation raise in a bad market year meaningfully improves the odds your money outlives you.

Choosing your withdrawal rate

3–3.5%, conservative. Suits very early retirees (40s) with 40–50 year horizons, or anyone who wants high certainty.
4%, the classic benchmark for a ~30-year retirement.
4.5–5%, aggressive. Reasonable with flexibility (part-time income, ability to cut spending) or a shorter horizon, risky otherwise.

Longer retirement, lower rate. If you're retiring at 45 rather than 65, lean conservative, or plan a Barista FIRE phase so your portfolio isn't doing all the work in the early years.

Frequently asked questions

Does the 4% rule include taxes?

No, the withdrawal is gross. Taxes depend on your account types (taxable vs tax-advantaged) and jurisdiction, so treat taxes as part of your annual spending when you set your target income.

Do dividends count toward the 4%?

Yes. The rule measures total withdrawals from the portfolio, whether they come from dividends, interest or selling shares.

What about market crashes right after retiring?

That's "sequence-of-returns risk," the main reason the rule isn't 6%. Buffers that help: a year or two of cash, flexible spending, or some part-time income early on.

More FIRE calculators

FIRE Number CalculatorYour full financial-independence target. Early Retirement CalculatorThe age you can actually retire. Sequence of Returns RiskWhy the 4% rule isn't the 6% rule. Savings Rate CalculatorYears to FI from your savings rate.

Sources and further reading

Rules and figures on this page are drawn from the primary sources below, so you can verify them directly rather than take our word for it.

The Trinity Study, overview and findings