How long will $500,000 last in retirement?

With a 4% withdrawal rate ($20,000/year) and a balanced 60/40 portfolio historically averaging 6-7% returns, $500,000 has historically lasted 30+ years in the majority of scenarios. At a 5% withdrawal rate ($25,000/year), it lasts approximately 20-25 years depending on market sequence. At 6% ($30,000/year), you're looking at 15-20 years before depletion in average markets. These calculations assume no Social Security or other income. In practice, Social Security reduces the required portfolio withdrawal, dramatically extending how long the $500,000 lasts.

How long does a 4% withdrawal rate last?

The 4% rule was designed to survive the worst 30-year historical market sequences beginning at retirement. Research shows it has approximately a 90-95% success rate over 30 years in a 60/40 portfolio based on historical data. In median market conditions, a 4% starting withdrawal actually allows the portfolio to grow over 30 years — meaning many retirees end up with more than they started with. The 4% rule can fail in scenarios with unusually bad early market returns (sequence of returns risk), unusually long retirements (35+ years), or very low bond/equity returns going forward.

What withdrawal rate makes money last forever?

Research suggests a withdrawal rate of roughly 3.0-3.5% is sustainable indefinitely on a balanced portfolio in historical markets — the portfolio's investment returns exceed withdrawals often enough and by enough margin to maintain or grow the balance over time. This is sometimes called the 'perpetual withdrawal rate.' At 3.5% on a $1,000,000 portfolio, withdrawals are $35,000/year. Note: this is very conservative and may cause retirees to underspend. For most retirees, 4-4.5% is sustainable over 30 years without perpetual sustainability, which is typically sufficient.

How Long Will My Retirement Money Last? Tables by Withdrawal Rate and Return

The most common retirement fear is simple: running out of money while still alive. How long your portfolio lasts depends on your withdrawal rate, portfolio composition, investment returns, and — critically — what happens in your early retirement years.

Portfolio Longevity: Core Tables

How Long Various Portfolios Last at 4% Annual Withdrawal Rate

(Assumes portfolio starts at given balance; 4% of initial balance withdrawn annually; 2.5% inflation adjustments; 60/40 stock/bond allocation; returns based on historical averages)

Starting Balance	Annual Withdrawal (4%)	Estimated Portfolio Duration (median markets)	Estimated Duration (bad sequence)
$300,000	$12,000	25-30 years	18-22 years
$500,000	$20,000	30+ years	22-27 years
$750,000	$30,000	30+ years	25-30 years
$1,000,000	$40,000	30+ years (many scenarios: infinite)	28-33 years
$1,500,000	$60,000	Essentially perpetual	30+ years
$2,000,000	$80,000	Essentially perpetual	30+ years

Portfolio Longevity by Withdrawal Rate (Starting Balance $1,000,000)

Annual Withdrawal	Withdrawal Rate	Duration (7% avg returns)	Duration (5% avg returns)	Duration (3% avg returns)
$30,000	3.0%	Perpetual (grows)	40+ years	40+ years
$35,000	3.5%	40+ years	36 years	29 years
$40,000	4.0%	35+ years	28 years	21 years
$45,000	4.5%	28 years	22 years	17 years
$50,000	5.0%	22 years	18 years	14 years
$60,000	6.0%	17 years	14 years	11 years
$70,000	7.0%	13 years	11 years	9 years
$80,000	8.0%	10 years	9 years	7 years

These are approximations. Actual duration is highly sensitive to the sequence of returns, not just averages.

The Sequence of Returns Effect

Two portfolios with identical average returns but different return sequences can have dramatically different outcomes:

Same average return (6%), different sequence:

Year	Good Sequence Returns	Bad Sequence Returns
1-3	+15%, +12%, +10%	-25%, -18%, -12%
4-8	Mix around 6%	Mix around 6%
9-30	Early losses averaging 6% overall	Recovery years averaging 6% overall

Good Sequence Portfolio	Bad Sequence Portfolio
Starts high; withdrawals take small %	Starts depleted; withdrawals take large %
Compounds to large balance	Depleted so severely it cannot recover
May last 35-40+ years	May be depleted in 20-22 years

The early years matter most. A 30% portfolio loss in year 1 combined with a 5% withdrawal leaves 65 cents on the dollar working. The same loss in year 20 is much less damaging — the portfolio had 19 years to compound first.

Portfolio Duration by Starting Retirement Year (Historical Data)

How would a 4% rule retiree have fared starting in different years?

Retirement Start Year	Market Sequence	30-Year Outcome
1975	Bull market	Thrived; massive surplus
1982	Great bull market start	Excellent; ended with large balance
2000	Dot-com bust	Tight; barely survived in some scenarios
2009	Post-crisis bull market	Excellent
2022	Inflation + rate spike	Early indications: moderate difficulty

Historical worst case for 4% rule: The 1966 retiree faced high inflation + poor returns through the 1970s. Portfolio survived 30 years but was close to depletion by year 27.

The portfolio longevity tables above assume NO Social Security. Add Social Security and the picture changes dramatically:

Scenario	Portfolio Withdrawal	SS Income	Total Income	Portfolio Drain
No SS	$50,000/year from $1M (5%)	$0	$50,000	$50,000/year
$20,000 SS	$30,000/year from $1M (3%)	$20,000	$50,000	$30,000/year
$36,000 SS	$14,000/year from $1M (1.4%)	$36,000	$50,000	$14,000/year

This is why Social Security claiming age is so important: Delaying Social Security from 62 to 70 might add $1,200-$1,500/month to lifetime benefits — which, at the 4% withdrawal rate, is equivalent to $360,000-$450,000 of additional portfolio assets.

How Long Will $500,000 Last?

Monthly Spending (Beyond SS)	Annual Withdrawal	Estimated Portfolio Duration
$1,000/month above SS	$12,000 (2.4%)	35-40+ years
$1,500/month above SS	$18,000 (3.6%)	28-35 years
$2,000/month above SS	$24,000 (4.8%)	22-28 years
$2,500/month above SS	$30,000 (6.0%)	16-22 years
$3,500/month above SS	$42,000 (8.4%)	12-16 years

How Long Will $1,000,000 Last?

Monthly Spending (Beyond SS)	Annual Withdrawal	Estimated Portfolio Duration
$2,000/month above SS	$24,000 (2.4%)	40+ years (likely perpetual)
$3,000/month above SS	$36,000 (3.6%)	35-40 years
$4,000/month above SS	$48,000 (4.8%)	25-35 years
$5,000/month above SS	$60,000 (6.0%)	18-25 years
$6,500/month above SS	$78,000 (7.8%)	13-18 years

Factors That Extend Portfolio Longevity

Factor	Impact
Delaying Social Security to 70	Reduces portfolio draw by $1,000-$2,000+/month
Lower withdrawal rate in early retirement	Protects against sequence risk in the critical first 10 years
Partial annuitization (SPIA/QLAC)	Transfers longevity risk; maintains portfolio for discretionary
Part-time work in early retirement years	Even $10,000-$20,000/year reduces draw significantly
Dynamic spending (guardrails)	Automatic protection during bad market years
Higher equity allocation	Historically higher returns; higher volatility
Flexible spending (lower essentials)	Ability to cut spending in bad years extends portfolio life

Factors That Shorten Portfolio Longevity

Factor	Impact
Retirement during a market crash (sequence risk)	Worst case can deplete even well-funded portfolios early
Very high withdrawal rates (>5%)	Strong long-term portfolio growth rarely overcomes high draws
Inflation higher than assumed	Purchasing power erodes; real returns lower
High fees on investments	1% in fees over 30 years can reduce ending balance by 25%+
Major unexpected expenses (long-term care)	Can require $100K+/year; not modeled in standard tables
Early Social Security claiming	Permanent reduction in guaranteed income; increases portfolio draw for 20-30 years