Withdrawal rates

The amount you can withdraw annually from your retirement portfolio without depleting it will largely depend on both the conditions in the market and how your portfolio is invested.


The long-term impact

The difference between withdrawing $50,000 and $40,000 from a portfolio worth $1 million may seem small, but over time it can have a large impact on whether your portfolio will last throughout retirement.

The chart below shows the effects of small changes in withdrawal rates for a $1 million portfolio over the 30-year period staring December 31, 1972, which was right before a big decline in the market.

Front of chart

A modest withdrawal rate can increase the longevity of your portfolio

As the chart shows:

At a withdrawal rate of 8%, you would have run out of money as young as age 75. It may be tempting to withdraw as much as possible, but it’s easier to quickly deplete your portfolio than you realize.

Reducing the rate to 5% preserved assets for 13 more years — to age 88.


Making your assets last

While we can’t control the markets, you will give your retirement portfolio the best chance of lasting throughout your retirement if you maintain a risk-appropriate asset allocation and refrain from withdrawing at too high a rate.

The chart below shows the chances that your savings will last throughout your retirement for a range of withdrawal rate and asset allocation combinations.

Back of chart

Percent change your assets will last through your retirement

As the chart shows:

Even a 5-year difference can have a dramatic impact on whether or not you outlive your savings. This means it’s very important to have realistic expectations about how long you’ll need your money to last.

It’s possible to run out of money earlier by becoming too conservative too soon. Most people should continue to think of themselves as long-term investors when they enter retirement.


Points for professionals

  • Educate your clients about realistic withdrawal rates.
  • Identify clients approaching retirement and schedule time to discuss the current state of their assets and to begin identifying where transitions may need to be made.
  • Consolidate clients’ assets to effectively manage overall asset allocation and withdrawal rates throughout their retirement..
  • Create a strategy for meeting their retirement income needs through investments with proven records of consistent returns.
  • Help clients understand and prepare for the new world of retirement with our extensive client-approved resources.
  • Contact your BlackRock representative.


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