Last Update: 28 February 2023
All World ex-US Stock Market is an asset class belonging to Stocks category.
You can invest in this asset class, let it passively follow the market trend, and in the meantime you can periodically withdraw a portion of it for your retirement.
Worst case scenario so far, over a 30-year time horizon, you could have withdrawn 3.376% of your initial capital each year, kept withdrawing all the time (adjusting for inflation), and you wouldn't have run out of money before 30 years.
Considering the last 30-year (last update: February 2023), a safe withdrawal rate would have been 5.701%.
In this post, we will find out the most affordable withdrawal strategies. All calculations are made on actual historical series.
All World ex-US Stock Market asset class
Over the last 30 years (last update: February 2023), the asset class has returned 5.5% annualized, with a maximum drawdown of -58.35%.
Let's consider different timeframes, all ending at February 2023: which Withdrawal Rates could you have applied without running out of money in your retirement?
Timeframes ending at Feb 2023 |
Withdrawal Rate (%) |
Investment Performances |
||||
|---|---|---|---|---|---|---|
| Timeframe | Period from | Period to | Perpetual | Safe | Ann.Return(%) [ Infl.Adj. ] |
Max Drawdown(%) |
| 20 Years |
1 Mar 2003 |
28 Feb 2023 | 6.412 | 10.566 |
7.38 [ 4.78 ] |
-58.35 Nov 2007 - Feb 2009 |
| 30 Years |
1 Mar 1993 |
28 Feb 2023 | 3.313 | 5.701 |
5.50 [ 2.94 ] |
-58.35 Nov 2007 - Feb 2009 |
| 40 Years |
1 Mar 1983 |
28 Feb 2023 | 7.470 | 8.839 |
7.74 [ 4.77 ] |
-58.35 Nov 2007 - Feb 2009 |
| 50 Years |
1 Mar 1973 |
28 Feb 2023 | 3.398 | 4.098 |
7.70 [ 3.60 ] |
-58.35 Nov 2007 - Feb 2009 |
Withdrawal Rates Simulation (updated at Feb 2023)
During your retirement, tipically you want to divest periodically some amount of money from your invested capital, without running out of money over a long period.
How much would it be an acceptable withdrawal rate, for the All World ex-US Stock Market asset class?
For instance, assuming a 20 years retirement, the algorithm will cover each 20 year timeframe starting at every possible month in the given period between the start and end month.
Here's how simulations work (each simulation is based on actual asset class returns, in US dollars):
- At the beginning, you start with a certain amount of money invested in the portfolio (i.e. the initial invested capital).
- Each month, money is withdrawn from the portfolio. The withdrawal rate is calculated based on the initial withdrawn, annualized.
- Each month, portfolio value is updated, based on the asset classes returns (dividends are supposed to be reinvested).
- Each month, portfolio is rebalanced, to reset to the original weight of the assets (applicable only if portfolio contains at least 2 assets).
- Each month, the withdrawal is adjusted for inflation (US Inflation is used for simulation).
The Perpetual Withdrawal Rate (PWR) is the percentage of the initial portfolio balance that can be withdrawn at the beginning of each month with inflation adjustment, preserving the original invested capital, adjusted for inflation too. In this website, you can find PWRs with 100% Capital Protection, or less.
The Safe Withdrawal Rate (SWR) is the percentage of the initial portfolio balance that can be withdrawn at the beginning of each month with inflation adjustment, without the portfolio running out of money. In this website, you can find SWRs with 100% Success rate, or less.
Learn more about Withdrawal Rate simulation
Data Sources and Credits
Analyzing the available data source, several N-years timeframes have been considered to calculate the withdrawal rates and their success percentage.
For instance, given a 20 years timeframe, the algorithm will cover each 20 year timeframe starting at every possible month in the given period between the start and end month (Feb 2023).
|
PWR (%) - Perpetual Withdrawal Rate
|
SWR (%) - Safe Withdrawal Rate
|
||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Preserved Capital | 100% | 75% | 50% | 25% | 0% | 0% | 0% | 0% | 0% | ||
| Success Rate | 100% | 100% | 100% | 100% | 100% | 95% | 90% | 80% | 50% | ||
| Timeframes |
20 Years Worst Period (from) |
0.000 Nov 1988 |
0.000 Mar 1989 |
1.558 Mar 1989 |
3.131 Mar 1989 |
4.476 Jan 1990 |
4.934 | 5.235 | 5.782 | 7.166 | |
|
30 Years Worst Period (from) |
1.230 Jan 1989 |
1.815 Jan 1989 |
2.374 Jan 1990 |
2.875 Jan 1990 |
3.376 Jan 1990 |
3.620 | 3.849 | 4.582 | 7.367 | ||
Withdrawals and Success Rate
If you had implemented a specific Withdrawal Strategy with the All World ex-US Stock Market asset class, which would have been the success rate so far?
Simulations follow the same rules mentioned before. Withdrawals are expressed as yearly rates and refer to the initial capital. After that, withdrawal amount is monthly adjusted for inflation.
Success rates are calculated over all the past timeframes available in the data source. To focus on a specific withdrawal rate, click on the links in the table.
| Withdrawal Rate |
20 Years
|
30 Years
|
||
|---|---|---|---|---|
| % Success | Percentile | % Success | Percentile | |
| 2.00 % |
100.00
|
100.00
|
||
| 2.50 % |
100.00
|
100.00
|
||
| 3.00 % |
100.00
|
100.00
|
100% Succ. 3.376% |
|
| 3.50 % |
100.00
|
98.34
|
95% Succ. 3.620% |
|
| 4.00 % |
100.00
|
100% Succ. 4.476% |
86.31
|
|
| 4.50 % |
99.72
|
95% Succ. 4.934% |
81.74
|
80% Succ. 4.582% |
| 5.00 % |
94.74
|
90% Succ. 5.235% |
74.27
|
|
| 5.50 % |
86.15
|
80% Succ. 5.782% |
66.80
|
|
| 6.00 % |
72.02
|
61.00
|
||
| 6.50 % |
55.40
|
59.34
|
||
| 7.00 % |
50.97
|
50% Succ. 7.166% |
56.85
|
50% Succ. 7.367% |
| 7.50 % |
47.37
|
46.47
|
||
| 8.00 % |
42.66
|
37.76
|
||
Related Pages
Asset Class Main Page:
All World ex-US Stock Market Asset Class
For the All World ex-US Stock Market Asset Class, we have prepared a report for each available timeframe:
20-Year
30-Year
if you want to learn more about the statistics of a specific withdrawal rate, we suggest these in particular:
2%
2.5%
3%
3.5%
4%
4.5%
5%
Website Homepage:
BestRetirementPortfolio.com