How retirement withdrawal calculator works
Enter your starting nest egg, the amount you withdraw in the first year, the number of years you want the money to last, the expected annual investment return, and expected inflation. The calculator shows your withdrawal rate — the first-year withdrawal as a percentage of the nest egg.
It then simulates each year: a withdrawal is taken from the balance, the remaining balance grows by the annual return, and (by default) next year's withdrawal rises with inflation so your spending power stays roughly constant in real terms. The simulation runs until the balance is exhausted or the horizon is reached.
The result reports the real return (return after inflation), the number of years the money lasts, the balance left at the end of the horizon, and a 4% rule sanity check. The 4% rule is a common guideline suggesting you can withdraw about 4% of a balanced portfolio in the first year and adjust for inflation thereafter, with a good chance of the money lasting 30 years — but it is a rule of thumb, not a guarantee.