Last Update: 30 April 2023
Total US Bond Market is an asset class belonging to Fixed Income 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Worst case scenario so far, over a 30-year time horizon, you could have withdrawn 2.461% of your initial capital each year, kept withdrawing all the time (adjusting for inflation), and you wouldn't have run out of money before 30 years.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: April 2023), a safe withdrawal rate would have been 5.144%.
In this post, we will find out the most affordable withdrawal strategies. All calculations are made on actual historical series.
Total US Bond Market asset class
Over the last 30 years (last update: April 2023), the asset class has returned 4.32% annualized, with a maximum drawdown of -17.28%.
Let's consider different timeframes, all ending at April 2023: which Withdrawal Rates could you have applied without running out of money in your retirement?
Timeframes ending at Apr 2023 |
Withdrawal Rate (%) |
Investment Performances |
||||
---|---|---|---|---|---|---|
Timeframe | Period from | Period to | Perpetual | Safe | Ann.Return(%) [ Infl.Adj. ] |
Max Drawdown(%) |
20 Years |
1 May 2003 |
30 Apr 2023 | 0.528 | 5.858 |
3.02 [ 0.47 ] |
-17.28 Aug 2020 - Oct 2022 |
30 Years |
1 May 1993 |
30 Apr 2023 | 2.100 | 5.144 |
4.32 [ 1.76 ] |
-17.28 Aug 2020 - Oct 2022 |
40 Years |
1 May 1983 |
30 Apr 2023 | 4.048 | 5.811 |
5.96 [ 3.03 ] |
-17.28 Aug 2020 - Oct 2022 |
50 Years |
1 May 1973 |
30 Apr 2023 | 2.399 | 3.465 |
6.44 [ 2.39 ] |
-17.28 Aug 2020 - Oct 2022 |
60 Years |
1 May 1963 |
30 Apr 2023 | 1.834 | 2.617 |
6.01 [ 2.03 ] |
-17.28 Aug 2020 - Oct 2022 |
70 Years |
1 May 1953 |
30 Apr 2023 | 1.760 | 2.370 |
5.56 [ 1.96 ] |
-17.28 Aug 2020 - Oct 2022 |
Withdrawal Rates Simulation (updated at Apr 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 Total US Bond 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 (Apr 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 May 1897 |
0.000 Jan 1899 |
0.947 Aug 1939 |
2.376 Aug 1939 |
3.660 Feb 1941 |
4.156 | 4.596 | 4.821 | 5.978 | |
30 Years Worst Period (from) |
0.000 May 1890 |
0.000 Jun 1939 |
0.753 May 1940 |
1.637 Nov 1940 |
2.461 Feb 1941 |
2.810 | 3.049 | 3.461 | 4.052 | ||
40 Years Worst Period (from) |
0.000 Feb 1933 |
0.000 Nov 1938 |
0.157 Sep 1941 |
1.008 Aug 1941 |
1.834 Feb 1941 |
2.059 | 2.237 | 2.779 | 3.252 | ||
50 Years Worst Period (from) |
0.000 Feb 1931 |
0.226 Jun 1934 |
0.748 Jun 1934 |
1.202 Jun 1939 |
1.513 Feb 1941 |
1.717 | 1.791 | 2.368 | 2.815 | ||
60 Years Worst Period (from) |
0.629 Oct 1915 |
0.844 Aug 1939 |
1.026 Aug 1939 |
1.207 Aug 1939 |
1.384 Feb 1941 |
1.534 | 1.614 | 2.077 | 2.451 | ||
70 Years Worst Period (from) |
0.257 Aug 1911 |
0.654 May 1911 |
1.044 May 1911 |
1.183 Jun 1939 |
1.307 Feb 1941 |
1.433 | 1.498 | 1.831 | 2.141 |
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 Apr 1932 |
0.000 Sep 1938 |
0.947 Aug 1939 |
2.376 Aug 1939 |
3.660 Feb 1941 |
4.025 | 4.245 | 4.739 | 5.625 | |
30 Years Worst Period (from) |
0.000 Oct 1932 |
0.000 Jun 1939 |
0.753 May 1940 |
1.637 Nov 1940 |
2.461 Feb 1941 |
2.696 | 2.825 | 3.198 | 3.807 | ||
40 Years Worst Period (from) |
0.000 Feb 1933 |
0.000 Nov 1938 |
0.157 Sep 1941 |
1.008 Aug 1941 |
1.834 Feb 1941 |
1.997 | 2.073 | 2.290 | 3.101 | ||
50 Years Worst Period (from) |
0.000 Feb 1931 |
0.226 Jun 1934 |
0.748 Jun 1934 |
1.202 Jun 1939 |
1.513 Feb 1941 |
1.595 | 1.716 | 1.791 | 2.675 | ||
60 Years Worst Period (from) |
0.663 Aug 1939 |
0.844 Aug 1939 |
1.026 Aug 1939 |
1.207 Aug 1939 |
1.384 Feb 1941 |
1.434 | 1.524 | 1.591 | 2.263 | ||
70 Years Worst Period (from) |
0.805 Jun 1939 |
0.931 Jun 1939 |
1.057 Jun 1939 |
1.183 Jun 1939 |
1.307 Feb 1941 |
1.339 | 1.390 | 1.466 | 1.866 |
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) |
0.423 Mar 2003 |
1.797 Mar 2003 |
3.171 Mar 2003 |
4.526 May 2003 |
5.317 May 1973 |
5.961 | 6.138 | 6.308 | 7.149 | |
30 Years Worst Period (from) |
2.048 Mar 1993 |
2.826 Mar 1993 |
3.591 May 1973 |
3.957 May 1973 |
4.322 May 1973 |
4.809 | 5.006 | 5.144 | 5.867 |
Withdrawals and Success Rate
If you had implemented a specific Withdrawal Strategy with the Total US Bond 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
|
40 Years
|
50 Years
|
60 Years
|
70 Years
|
||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
% Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | |
2.00 % |
100.00
|
100.00
|
100% Succ. 2.461% |
97.26
|
95% Succ. 2.059% |
86.33
|
80% Succ. 2.368% |
82.60
|
80% Succ. 2.077% |
64.21
|
50% Succ. 2.141% |
|
2.50 % |
100.00
|
99.39
|
95% Succ. 2.810% |
86.88
|
80% Succ. 2.779% |
73.72
|
50% Succ. 2.815% |
46.71
|
33.97
|
|||
3.00 % |
100.00
|
90.81
|
90% Succ. 3.049% |
68.87
|
50% Succ. 3.252% |
39.71
|
22.45
|
19.62
|
||||
3.50 % |
100.00
|
100% Succ. 3.660% |
77.88
|
42.62
|
19.53
|
15.24
|
12.64
|
|||||
4.00 % |
97.36
|
95% Succ. 4.156% |
51.53
|
50% Succ. 4.052% |
28.91
|
12.94
|
9.92
|
7.58
|
||||
4.50 % |
92.20
|
90% Succ. 4.596% |
43.98
|
19.27
|
7.49
|
6.04
|
5.86
|
|||||
5.00 % |
72.18
|
38.33
|
13.86
|
5.45
|
4.69
|
4.65
|
||||||
5.50 % |
54.69
|
50% Succ. 5.978% |
26.75
|
9.79
|
4.23
|
3.25
|
2.43
|
|||||
6.00 % |
49.72
|
17.63
|
7.26
|
3.09
|
1.26
|
0.20
|
||||||
6.50 % |
42.98
|
12.87
|
5.78
|
1.71
|
0.00
|
0.00
|
||||||
7.00 % |
34.93
|
8.85
|
3.56
|
0.00
|
0.00
|
0.00
|
||||||
7.50 % |
26.81
|
6.13
|
1.70
|
0.00
|
0.00
|
0.00
|
||||||
8.00 % |
18.57
|
3.88
|
0.22
|
0.00
|
0.00
|
0.00
|
Withdrawal Rate |
20 Years
|
30 Years
|
40 Years
|
50 Years
|
60 Years
|
70 Years
|
||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
% Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | % Success | Percentile | |
2.00 % |
100.00
|
100.00
|
100% Succ. 2.461% |
94.87
|
90% Succ. 2.073% |
72.05
|
61.54
|
50% Succ. 2.263% |
43.77
|
|||
2.50 % |
100.00
|
98.93
|
95% Succ. 2.696% |
75.45
|
60.07
|
50% Succ. 2.675% |
35.34
|
7.76
|
||||
3.00 % |
100.00
|
83.95
|
80% Succ. 3.198% |
57.70
|
50% Succ. 3.101% |
26.46
|
0.00
|
0.00
|
||||
3.50 % |
100.00
|
100% Succ. 3.660% |
71.11
|
50% Succ. 3.807% |
35.78
|
3.16
|
0.00
|
0.00
|
||||
4.00 % |
95.63
|
95% Succ. 4.025% |
46.85
|
21.78
|
0.00
|
0.00
|
0.00
|
|||||
4.50 % |
87.83
|
80% Succ. 4.739% |
38.76
|
10.40
|
0.00
|
0.00
|
0.00
|
|||||
5.00 % |
70.76
|
34.96
|
7.77
|
0.00
|
0.00
|
0.00
|
||||||
5.50 % |
53.28
|
50% Succ. 5.625% |
21.64
|
6.24
|
0.00
|
0.00
|
0.00
|
|||||
6.00 % |
46.51
|
11.53
|
4.44
|
0.00
|
0.00
|
0.00
|
||||||
6.50 % |
37.98
|
8.09
|
3.61
|
0.00
|
0.00
|
0.00
|
||||||
7.00 % |
30.59
|
5.71
|
1.80
|
0.00
|
0.00
|
0.00
|
||||||
7.50 % |
23.20
|
3.21
|
0.28
|
0.00
|
0.00
|
0.00
|
||||||
8.00 % |
13.11
|
2.02
|
0.00
|
0.00
|
0.00
|
0.00
|
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
|
||
3.50 % |
100.00
|
100.00
|
||
4.00 % |
100.00
|
100.00
|
100% Succ. 4.322% |
|
4.50 % |
100.00
|
96.68
|
95% Succ. 4.809% |
|
5.00 % |
100.00
|
100% Succ. 5.317% |
90.46
|
90% Succ. 5.006% |
5.50 % |
98.34
|
95% Succ. 5.961% |
68.46
|
50% Succ. 5.867% |
6.00 % |
93.91
|
90% Succ. 6.138% |
40.25
|
|
6.50 % |
74.24
|
28.22
|
||
7.00 % |
55.96
|
50% Succ. 7.149% |
19.92
|
|
7.50 % |
37.95
|
11.20
|
||
8.00 % |
21.05
|
7.05
|
Related Pages
Asset Class Main Page:
Total US Bond Market Asset Class
For the Total US Bond Market Asset Class, we have prepared a report for each available timeframe:
20-Year
30-Year
40-Year
50-Year
60-Year
70-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