Will Your Money Last? What the Numbers Actually Say
A plain-English look at withdrawal rates, portfolio success, and why a guaranteed income stream changes the entire equation.
KC
Kris Cowles
The Retirement Income Guru
⏱ 7 min read
One of the most important questions in retirement is deceptively simple: how much can I take out of my portfolio each year without running out of money?
The answer depends on three things — how much you withdraw, how your money is invested, and how long your retirement lasts. The charts below show you exactly how those three factors interact — and what a guaranteed income source changes about the picture.
What Is a "Success Rate"?
Researchers run thousands of simulated retirements using real historical market data — every combination of good years, bad years, crashes, and booms that has actually occurred since 1926. They count how often the money lasted the full retirement period. That percentage is the probability of success.
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A 90% success rate means the portfolio survived in 900 out of 1,000 simulations. In 100 scenarios, the money ran out. All tables below assume withdrawals increase 2.5% per year for inflation.
Historical Success Rates: Withdrawal Rate vs. Portfolio Allocation
Green = historically safe. Red = high risk of running out. Annuity column shows 100% in every scenario because income is guaranteed for life, regardless of market conditions.
🔍 Success Rate Explorer
Adjust withdrawal rate and retirement length to see how success rates change across different portfolio mixes
Withdrawal Rate
4%
5%
6%
7%
8%
Retirement Length
20 Years
25 Years
30 Years
Based on historical simulations. Past performance does not guarantee future results. Annuity = fixed immediate annuity with guaranteed lifetime income.
What the Tables Show
The 4% rule holds up well — but not perfectly. At 4% with a 60/40 portfolio over 30 years, history shows a 90% success rate. That's solid — but it means 1 in 10 retirees ran out of money in historical simulations.
Higher withdrawal rates fall off a cliff. Going from 4% to 6% can cut your success rate nearly in half over 30 years. At 8%, even an all-stock portfolio only succeeds about half the time historically.
Bonds alone are the riskiest option at higher rates. A mostly-bond portfolio might feel conservative, but it carries the highest risk of running out at any withdrawal rate above 4%.
"The annuity solves the one problem a portfolio never can: it eliminates the possibility of outliving your money entirely."
— Kris Cowles, The Retirement Income Guru
The Annuity: 100% in Every Box
A Fixed Annuity: Guaranteed Income for Life
A fixed income annuity converts a lump sum into a guaranteed monthly payment for life. Markets can crash, interest rates can move — your check still arrives. No simulation needed. No probability to worry about.
100%
Probability your income continues
That doesn't mean annuities are right for everyone. Fixed payments lose purchasing power over time unless you add an inflation rider, and your money is generally locked in once annuitized. But for covering essential monthly expenses — the non-negotiables — the certainty of an annuity is hard to match.
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A common strategy: Use Social Security, any pension, and potentially an annuity to cover essential expenses. Use your investment portfolio for discretionary spending — travel, gifts, and flexibility — where certainty matters less.
The Bottom Line
If you need more than 4–5% from your portfolio each year, or if your retirement could last 30+ years, the risk of running out is real and worth taking seriously. A conversation about guaranteed income is one of the most valuable things you can do in retirement planning.
Want to see how this applies to your situation?
Book a free 30-minute consultation and we'll run through your numbers together — no pressure, no sales pitch.