Nest Egg Withdrawal Rates

Suppose you had a client with a $1 million nest egg (½ stocks and ½ bonds) who began taking withdrawals at age 65 at the beginning of 1973. Depending on the inflation-adjusted withdrawal rate, the client would have been broke before age 77 (January 1977) if the withdrawal rate had been 7–8% per year; the entire nest egg would not have been wiped out until age 89 (January 1997) if the rate had been 5% (age 82–83 at a 6% rate). However, if the inflation-adjusted rate had been just 4% per year (i.e., $40K the 1st year and then $41.2K the 2nd year, etc.), the nest egg would have been worth $2.1 million when the client reached age 101. 

20 Years of Withdrawals: Likelihood of Success