How much can I safely spend each year?

• Fixed real (the 4% rule). Year-one spending is a percentage of the starting balance and rises with inflation every year no matter what markets do.
• Fixed percent of balance. The same percentage of whatever the balance is each year; income swings with markets and can never hit zero.
• Guardrails (Guyton-Klinger style). Inflation raises are skipped after a losing year, spending is cut 10% when the withdrawal rate rises above 120% of the starting rate, and raised 10% when it falls below 80%. No cuts in the final 15 years.
• RMD-style. Each year’s spending is the balance divided by the IRS life-expectancy divisor for your age (extended below 72), so the percentage rises as you age.

$1,000,000 at 65, a 4% starting rate ($40,000), 30 years, 6% average return, 0.25% fees, 2.5% inflation. With the same return every year, fixed-real spending lasts all 30 years and ends with about $527,000 in today’s dollars. Change the sequence to bad start (two losing years first, then 6%): fixed-real spending runs out in year 23 and the highest starting rate that survives is 3.29%, while guardrails survive with five spending cuts and a lowest inflation-adjusted income of about $22,500. That gap is sequence risk.

Each year the strategy sets the withdrawal, the withdrawal is taken at the start of the year, and the remaining balance earns that year’s return after fees. Real (today’s-dollar) values divide by cumulative inflation. The “highest safe fixed rate” is found by searching for the largest starting rate at which fixed-real spending survives the chosen sequence.

Stylized return sequences rather than historical data; withdrawals are before tax; no Social Security or other income; a single portfolio. Monte Carlo paths are on the full household plan.

Confirm any decision with an official Social Security statement, your plan custodian, and a qualified adviser. See the methodology and changelog for every rule the model applies.

Is the 4% rule still valid in 2026?

It remains a reasonable starting point for a 30-year horizon with a balanced portfolio, but it assumes you never adjust. Dynamic rules such as guardrails start higher and cut when needed, which many retirees prefer to a fixed plan that can fail outright.

What is a sequence of returns risk?

Losses in the first years of retirement, when withdrawals come out of a shrinking balance, do more damage than the same losses later. The bad-start sequence in the calculator shows this directly.

What are Guyton-Klinger guardrails?

Decision rules from a 2006 study: raise spending with inflation except after losing years, cut 10% when the current withdrawal rate exceeds 120% of the initial rate, and raise 10% when it falls below 80%.