The S&P 500 calculator and also the fund Withdrawal Survival Depletion Test below examines 55 years of historic S&P 500 returns. Don't miss that, there is a lot there. Both calculators use your input parameters, and there is also a list of guided Examples below to show the calculator options, which can compare and show the effect of the past history and very importantly, show the effect of withdrawals (4% or any others). It offers an interesting view about the years of market gains. It can also show compounding of gains over a multi-year period, including the effect of withdrawals or additional investment.

But there is also a lot more here. This page is just the calculators (and some history statistics), but the page was far too long as one page, so the introductory material describing the S&P 500 and the market and the 4% Rule was reluctantly moved to a second page at A few Market Things you need to know if you don’t already. If you are new to the market, it's there if you want to see it.

My suggestion is: Plan decades early for retirement, because many years of compounding is your best tool. Reinvest all dividends and don't withdraw anything until retirement. Then the final amount available at retirement might be a huge pleasant surprise. Relatively massive withdrawals might be possible during retirement if there were enough investing years (see the Example 4 below).

Withdrawal Strategies

Continued withdrawals as dollar amounts can be dangerous. Fixed amounts need to be adjusted lower when the market is down, because a fixed dollar amount can seriously deplete the account when low. For example, fixed withdrawals of only $200 per month (foolishly starting at first year) depletes this S&P 500 fund in 14 starting years since 1970 (meaning, withdrawing soon after starting, before it grows, or in low periods, are dangerous). Withdrawals of course reduce your investment, and it should be obvious that also seriously reduces your future compounded gains. The good plan is to add more investment all along instead of reducing it. So let your investment grow for maybe 30 years, and only start withdrawing at retirement, and that becomes an extremely different picture, and surely matches your retirement goals better too.

Withdrawing a percentage amount (percentage dollars adjusted every year, to be same percentage) is much safer, is less dollars when fund is low and more when high, but 10% withdrawal even starting at First year does not fail here (but withdrawals that about match the growth rate also does not grow either).

There are several guided examples below. More money in the fund (after it grows) will always last longer, but technically, if no withdrawals, the fund does not go bust in the bad periods even if starting with only $300 in 1970 (the Lower Limit of $100 that defines Depletion can affect that test result).

Be sure to see Example 8 (also here:  ) to show the idea about first investing 30 years for retirement without withdrawals. Then the example shows retirement withdrawals starting in 2000 (even if 1973-1974 and 2000 to 2008 were particularly bad times in the market). 50 years is a long time, but the calculator can be started in any year. Retirement should plan on a prior 30 or 40 years of growth first, if possible.

One purpose of these examples is to show some of the controls possible in the calculator, but the really big point is that if no withdrawals, 50 years of S&P 500 gains will be absolutely awesome. Retirement time will come, ready or not, and you need to realize that you should get started on it NOW. Time is the tool that works, but if you wait too long, this huge opportunity diminishes.

Guided Examples of Using the Calculator

If not withdrawing, the fund will not go bust. Very bad times in the past have dropped it to near 50%, but not to very near zero. That will certainly be very worrisome then and requires waiting for its recovery, but if you let it ride, it will recover. The market has always recovered (but which sometimes could take a year or two). But withdrawing it then just makes the loss real and permanent. The S&P 500 companies are very well established, and it will come back. Following are a few examples of that in the last 50 years.

This is looking at some choices with investment starting with $25,000, to show the good effect of minimizing withdrawals. The example results are more in agreement with the 2021 totals. The exact result values in these examples will vary from the last 2024 result entered in the calculator chart (the text in these examples below is Not updated with every days current price change, but the calculator itself will recalculate from the last price entered.) You can of course then adjust the values to fit your goals. Again, these results are computed from the past years in history, and future results are not known. The standard qualifying words are: Past performance is no guarantee of future results.

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Examples 1-10:

1. Start at 1970: (53 years until today) If with no withdrawals of any kind, $25K grew to $6.4 Million today. This is the pages initial default case. The message is: Start your investing early. It will be all-important when you near retirement age.
So try some things in the calculator. The bad years are survivable, but withdrawals may not be. (Again, the future is unknown, but some of the past was pretty bad, until it recovered.)

  1 Show this setup in calculator (Example 1 just restores the initial chart).

2. Withdrawing all dividends (from $25K start, but never setting up reinvestment of dividends) instead reduces gains of less money working, which seriously drops to "only" $1.2 Million, plus $343K withdrawals (instead of $6.4 million if no withdrawals). DO NOT ignore the long term importance of reinvesting dividends. The dividend may be small, like maybe 2%, but it repeats and compounds and grows, every year.The point is that in 53 years, withdrawing the $343K of dividends cost $5.2 Million loss of future long term growth. And this certainly applies equally to any and all withdrawals, which are very nonproductive.

  2 Show this setup in calculator

3. Or instead of dividends, continuous withdrawal of $100 per month (totaling $65K in 53 years) dropped the fund to $17K first (in 1974 which was particularly bad times), but it survived, and grew to $2.9 Million in 53 years. However that $65K of withdrawals cost $3.5 Million of the gains in example 1 (over 53 years). Give that some thought concerning withdrawals. However withdrawing anything so early is far from wise. The fund needs to build more money to survive bad times.

  3 Show this setup in calculator

A few more things you might see here about how things work.

• Change the withdrawal to $200/month, and it goes bust in 1989 with $46K of withdrawals. Black Monday in October 87 was the largest ever one day drop of the market, 22.6%, but it quickly recovered, and market rules are more strict now. But the bust really wasn't even due to the market, it was due to the withdrawals. Look at the numbers. The $2400 annual withdrawals (10% to 50+% a year) had been draining the fund since it started. The fund would have been $235K at the end of 1989 if no withdrawals. But that $46K of $200 withdrawals cost the entire $6.4 Million future total. The trick is getting past the bad times, and withdrawing is the worst thing to do, so at least pause withdrawing then. Withdrawals require having money to withdraw, and recoveries require leaving something to work with.

  More money in the fund does last longer. Change the $25000 to $30000 and click Test, and the $200/month withdrawal does not fail starting in 1970.

  However, always check the Depletion Failure chart too. The 1970 start may be fine, but many start years do not fail at $200/month withdrawal, but about ten more start years also fail starting up near 2000. These have too few years to grow before the bad times.

  The Main Point here is to know to let the fund grow without withdrawals the first few decades, to first grow enough to survive the bad times, and still be there for the recovery that is coming. That greater growth (without withdrawals) also provides considerably more retirement money too, which should be a major concern. You should realize that early withdrawals are very costly, costing greatly more future earnings than they return now.

• Very important points: Instead starting 1970 with $25K and withdrawing a small percentage, like 5% a year (recomputed each year), would have withdrawn 539K and ended today with $610K in this example), and then very much more after it grows some. To prevent excesses, limiting that 5% with a $1000/month maximum (button 3) would have also survived today (with $919K, but total fund earnings would total about $1.3 MK instead of $6.4 Million).
  But of course, holding off on withdrawals until retirement needs it is the correct answer. Starting $5000 a month withdrawals ($60K/year) in 2000 (with a bad decade ahead) for 23+ years still leaves $4.9 M in the fund today. However starting that fund after 1983 still fails all starting years.

While it may not be intuitive during the bad times of gloom and doom and worry about the market, but actually, those low points are exactly the right time to be adding more money then (to buy low), making recovery gains grow dramatically. The low points would be the worst time to sell it off. It recovers, but it could take a year or two.

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4. This might get your attention... a more expected procedure. 30+ years S&P 500 investment followed by 22+ years of $60K per year withdrawals in retirement.

Continual withdrawals beginning Day One is NOT a normal plan. To make the fund count with greater gains, let it build for many years until retirement time, and only then start withdrawing to help replace salary. Or maybe if already retired and you have some savings that are not earning anything, but need it to help with immediate withdrawals for living expenses. The S&P is capable with higher gains that have averaged about 10% a year. Some years more, and some years less, and some even negative several times. And BIG negative (near -50%) a few times. Again, the S&P 500 is the stocks of the 500 largest USA companies, relatively safe IMO. Market crashes can certainly still occur, but they always recover eventually. But when moving savings, do realize there is market risk, stocks can lose value (and unless it is IRA or 401, moving is likely a taxable event).
  4 Show this example in the calculator

But always check the Depletion test. This example does go bust at 4 start years near 2000. But deferring these withdrawals even five years supports the withdrawals to make a big difference.

This past data includes several really poor years (possibly typical), so caution is advised in the future real world. This idea is to let it grow to a substantial value before starting withdrawals, and then keep an eye out on the gain of future years then. If the average gain is keeping up with the average withdrawal, it will work. The average S&P gain has been near 11%, but 2000 began three years averaging about -15% (which then of course still did recover). Starting 1970 looks real good, but the Test shows a few failure starting years around 1997 (because the new fund had not grown much before the bad years starting at 2000).

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5. An IRA account has a $6000 annual contribution limit, which increases a bit every few years. This example starts Dec 31 1979 with first $6000, and then continuously add the maximum tax-free contribution of $500 per month ($6000 per year IRA limit until 2004, contribution totaling $150K in the 25 years). It grew to $1 million in that time (which included the 2000s decade), and to $5.9 Million in the next 22 years until now. There will be a lot of tax owed on the IRA (regular income tax rate too, no capital gains in IRA), but you would like that at retirement time, it certainly seems worthwhile. If it were Roth, it would be tax free and also allow larger contributions.
  5 Show this setup in the calculator

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6. Start at 2000: About the worst staring year, the entire 2000 decade were poor. But Buy low, when it is down, except it gets worse and more attractive in 2008. The 2000s were really bad times with two severe crashes in the decade (2001 and 2008), so bad it didn't recover until 2010. But if no withdrawals of any kind, $25K still grew to $124K today, which is not too shabby, about 5x, and 7+% annualized return (even starting in 2000). And the Test result shows this same thing (as no withdrawals), starting in every year, same $109K if starting in 2000.
  6 Show this setup in the calculator, starting at about the worst time.

But then instead of withdrawing anything, adding more money at the low points is the special opportunity to see dramatically greater gains in the recovery. Adding $25K more in 2002 (doubling original investment when price was down about 40%, and things looked so bad) would total $282K in 2021. We can't time the bottom, so had this been the plan, you'd done it earlier, and continued adding all along.

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7. Start at 2009: (12 years) These were the better good times, building from the previous 2008 lows, and if with no withdrawals, $25K in 2000 grew to $165K in about that time. But economic and political pressures can hurt the market, so there is always risk. But so far, the market has always recovered and continued the gains.
  7 Show this setup in the calculator

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Perhaps of the most interest to the concept, 8 and 9 are results of two of what turned out to be the worst-timed bad investment times (unavoidable because the future is unknown. But it does recover.)

8. Start a $25K investment at 1973 right before the 1974 crash and see it drop 40% then. But don't touch it for 27 years, and then start withdrawing 8% in 2000 (just in time for a really BAD decade, which turned out to be some of the worst scary times, but your fund had resources by then to withstand it). So from 2000, start 22 years of retirement withdrawals totaling $1 M, varying widely but averaging perhaps about $42K annually (about $3500 monthly, but varying). And it still leaves about $670K remaining today, maybe for inheritance (often a goal). The entire cost to you was the original $25K (this is past history, it cannot predict the future, but there are better times than this example hits).
  8 Show this setup in the calculator

However, the abnormally large 9% withdrawals in the first three years of the 2000 downturn were detrimental. But if instead of 9%, try withdrawing a fixed $4000 a month (button 2, starting at year 2000 again) works if starting in 1973, but this fails early if not starting until the 1980s. Or limit it a bit by doing both, but limited to the smallest option 3, which leaves more in the fund. A large fixed withdrawal in a small fund hits the down years heavy. Whereas a reasonable percentage (assuming dollar amount is readjusted each year) is a smaller withdrawal in those down years. But even $200/month starting at Day One (when fund is small) fails several starting years.

But also try Option 3 then. A good plan is to use button option 3, with say BOTH of the same 10% and $5000 withdrawals in Option 3 as limits on each others extremes, which might limit a few years to be a little less, but which lets it build more, and then it runs in all years without failure. And it leaves quite a lot to provide inheritance. A percentage withdrawal may not be so much when the fund is low, but it won't go to zero and fail (if withdrawal dollars are adjusted accordingly each year). We can't know the future, but the total of all the many years is the really huge effect.

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9. Start investment at 2000 right before those crashes. Start withdrawing 6% in 2003 (right after the first crash), which is 20 years of withdrawals totaling near $28K for average of about $1.4K annually, with $40K remaining today. The last decade (2010s) saw good market growth, doubling in spite of the withdrawals. This growth time is short, but starting with 2x more money would have 2x greater results. To get that greater money (still trying to get your attention), simply starting ten years earlier would have made the 6% be near $6K average annual income assistance, with $175K left. Or 20 years earlier would be about $29K withdrawals with $850K left. Or 30 years earlier for $51K withdrawals with $1.5 Million left. Time is the awesome tool.
  9 Show this setup in the calculator

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10. Starting the fund just before bad years is Not the best plan, but we can't know the future. It is only shown as a worst case. But one example that works anyway. Start in 1970 with $25K, and then with button 5, contribute $500/month until 2000 ($186K more) when worth $500K, and thereafter withdraw $4000 a month ($48K a year for $1.2 million, but limited to 10%), which still remains worth nearly $321K then Except if it were are an IRA, the large gain would surely make the RMD be greatly higher.
  10 Show this setup in the calculator