Monte Carlo retirement calculator

Run your plan through 2,000 simulated markets, good and bad, and see how often your money lasts.

In short: A Monte Carlo retirement calculator runs your plan through thousands of random market paths and reports the share in which your money lasts. Planners commonly aim for a success rate of 80% to 95%.

Your numbers

Assumptions7% return · 15% volatility · 3% inflation

77% chance it lasts

In 1,533 of 2,000 simulated markets, withdrawing $40,000 a year lasted the full 30 years.

Withdrawal rate
4%
Median left after 30 years
$739,149
Left in a bad market (10th pct)
$0

What would change your result

  • For odds near 90%, keep withdrawals to about $30,800 a year (3.1%).
  • A calmer stock and bond mix (6% return, 10% volatility) gives 75%: here the lower return outweighs the smoother ride.
  • Trimming spending by 10% after a bad market year is one of the strongest ways to raise these odds.

What-ifs worked out from your own numbers. Not personal financial advice.

  • Median
  • 10th–90th percentile

Average real return 3.88%, volatility 15%. All amounts in today's dollars.

Year-by-year table
Year10th percentileMedian90th percentile
0$1,000,000$1,000,000$1,000,000
1$835,019$990,703$1,195,197
2$759,867$985,040$1,300,409
3$717,323$983,787$1,387,815
4$679,489$980,467$1,472,012
5$639,569$984,191$1,541,481
6$602,163$973,015$1,603,470
7$565,219$957,693$1,685,922
8$532,543$964,667$1,754,856
9$497,548$947,739$1,850,935
10$455,620$937,734$1,905,010
11$428,431$937,532$2,020,242
12$388,729$927,240$2,094,635
13$354,438$931,507$2,168,440
14$316,786$933,943$2,280,751
15$281,221$925,081$2,364,094
16$249,261$917,726$2,477,959
17$212,667$896,347$2,605,718
18$180,832$882,372$2,715,045
19$139,691$861,905$2,839,955
20$108,337$847,521$2,871,539
21$69,992$842,118$3,000,381
22$27,219$854,217$3,137,890
23$0$846,257$3,270,397
24$0$834,805$3,345,363
25$0$841,598$3,459,036
26$0$804,730$3,690,988
27$0$790,606$3,740,474
28$0$777,471$3,769,566
29$0$762,692$4,098,269
30$0$739,149$4,139,729

A worked example

With these inputs:

  • Portfolio at retirement$1,000,000
  • Yearly withdrawal$40,000
  • Years it must last30 years
  • Expected return7%
  • Volatility15%
  • Inflation3%

the calculator returns 77% chance it lasts. In 1,533 of 2,000 simulated markets, withdrawing $40,000 a year lasted the full 30 years.

Its first suggestion: For odds near 90%, keep withdrawals to about $30,800 a year (3.1%).

Key facts

  • With 7% expected returns, 15% volatility and 3% inflation, a 4% withdrawal lasts 30 years in about 77% of simulations; 3.5% raises that to about 86%.
  • A 100% stock portfolio has historically had yearly volatility near 15% to 20%; a 60/40 mix is closer to 10% to 12%.
  • Cutting spending after bad market years is one of the most effective ways to raise success rates.

How it's calculated

Each simulation draws a random return for every year. The draws are lognormal: the middle path compounds at exactly your expected return after inflation, the same rate the other calculators use, and your volatility sets how far good and bad years stray from it. Each year starts with your withdrawal, then the rest grows or shrinks.

A simulation succeeds if money remains after the final year. The shaded band holds the middle 80% of outcomes; the line is the median. The random draws use a fixed seed, so a shared link shows everyone the same result.

Limits worth knowing: each year's return is independent of the last. Real markets have streaks and occasional crashes deeper than this model expects, so treat a result near 100% with healthy doubt.

Questions people ask

What success rate should I aim for?

Many planners look for 80% to 95%. A plan that succeeds in 100% of simulations often means you could have spent more, while flexible spending can rescue a plan in bad years.

What volatility should I use?

A 100% stock portfolio has historically had yearly volatility near 15% to 20%. A 60/40 stock and bond mix is closer to 10% to 12%.

Why does a 4% withdrawal not show 100%?

This model allows bad sequences that US history has not produced over 30-year periods. That is the point: it stress-tests beyond the past.

Read more about it

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