US Long Term (20y+) Treasuries: a good asset for your retirement?

Last Update: 30 April 2023

US Long Term (20y+) Treasuries 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Worst case scenario so far, over a 30-year time horizon, you could have withdrawn 2.276% of your initial capital each year, kept withdrawing all the time (adjusting for inflation), and you wouldn't have run out of money before 30 years.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 6.315%.

In this post, we will find out the most affordable withdrawal strategies. All calculations are made on actual historical series.

US Long Term (20y+) Treasuries asset class

Over the last 30 years (last update: April 2023), the asset class has returned 5.66% annualized, with a maximum drawdown of -41.64%.

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?

The Withdrawal Rates calculated here are annualized and refer to the initial capital (not the current!). The first month withdrawal is 1/12 of that annualized withdrawal and it's adjusted for inflation for each subsequent month.

A Perpetual Withdrawal Rate (PWR) protected the original inflation adjusted capital.

A Safe Withdrawal Rate (SWR) didn't protect the original capital, but the investment didn't run out of money during retirement. The capital went to zero exaclty at the end of the retirement period.

Learn more about Withdrawal Rate simulation
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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 1.963 7.016 4.23
[ 1.65 ]
-41.64
Aug 2020 - Oct 2022
30 Years 1 May 1993
30 Apr 2023 3.767 6.315 5.66
[ 3.07 ]
-41.64
Aug 2020 - Oct 2022
40 Years 1 May 1983
30 Apr 2023 6.303 7.566 7.56
[ 4.58 ]
-41.64
Aug 2020 - Oct 2022
50 Years 1 May 1973
30 Apr 2023 2.808 3.507 7.37
[ 3.28 ]
-41.64
Aug 2020 - Oct 2022
60 Years 1 May 1963
30 Apr 2023 1.792 2.309 6.53
[ 2.52 ]
-41.64
Aug 2020 - Oct 2022
70 Years 1 May 1953
30 Apr 2023 1.513 1.932 5.82
[ 2.21 ]
-41.64
Aug 2020 - Oct 2022
Simulations are calculated with actual returns of US Long Term (20y+) Treasuries Asset Class | Preserved capital and withdrawals are considered adjusted for inflation | Withdrawals happen monthly | Performances are calculated in USD dollars, considering reinvestment of dividends when applicable | Inflation is updated at April 2023

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 US Long Term (20y+) Treasuries asset class?

Methodology and Definitions
The algorithm calculates the chance of success of a initial withdrawal rate, whose amount in dollars is adjusted monthly for inflation. The algorithm tries a retirement simulation, starting at every possible month in the given period.
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 Withdrawal Rates calculated here are annualized and refer to the initial capital (not the current!). The first month withdrawal is 1/12 of that annualized withdrawal and it's adjusted for inflation for each subsequent month.

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).

Period: Jan 1871 - Apr 2023
Swipe left to see all data
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 1897
0.000
Oct 1898
0.000
Sep 1961
1.995
Oct 1961
3.622
Feb 1941
3.929 4.171 4.621 5.816
30 Years
Worst Period (from)
0.000
Feb 1890
0.000
Dec 1937
0.000
Mar 1950
1.212
Apr 1950
2.276
Feb 1946
2.556 2.722 2.955 4.079
40 Years
Worst Period (from)
0.000
Jun 1930
0.000
Apr 1934
0.000
Nov 1939
0.328
Oct 1941
1.553
Feb 1946
1.735 1.993 2.362 3.289
50 Years
Worst Period (from)
0.000
Nov 1929
0.000
Mar 1930
0.101
Oct 1931
0.906
Jun 1934
1.241
Feb 1941
1.413 1.544 2.002 2.713
60 Years
Worst Period (from)
0.112
Jul 1922
0.662
May 1941
0.823
Dec 1940
0.979
Feb 1941
1.135
Jan 1941
1.294 1.353 1.753 2.330
70 Years
Worst Period (from)
0.000
Nov 1910
0.073
Oct 1911
0.704
Oct 1911
0.977
Feb 1941
1.081
Jan 1941
1.228 1.282 1.598 2.069
Legend:
SWR 100% Success
95% Success
90% Success
PWR 100% Capital Protection
75%
50% Protection
25%
Period: May 1923 - Apr 2023
Swipe left to see all data
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
Sep 1932
0.000
Sep 1938
0.000
Sep 1961
1.995
Oct 1961
3.622
Feb 1941
3.812 3.960 4.296 5.387
30 Years
Worst Period (from)
0.000
Sep 1932
0.000
Dec 1937
0.000
Mar 1950
1.212
Apr 1950
2.276
Feb 1946
2.496 2.584 2.786 3.437
40 Years
Worst Period (from)
0.000
Jun 1930
0.000
Apr 1934
0.000
Nov 1939
0.328
Oct 1941
1.553
Feb 1946
1.686 1.743 2.026 2.614
50 Years
Worst Period (from)
0.000
Nov 1929
0.000
Mar 1930
0.101
Oct 1931
0.906
Jun 1934
1.241
Feb 1941
1.354 1.410 1.540 2.202
60 Years
Worst Period (from)
0.308
Jun 1924
0.662
May 1941
0.823
Dec 1940
0.979
Feb 1941
1.135
Jan 1941
1.214 1.282 1.341 1.866
70 Years
Worst Period (from)
0.663
Feb 1941
0.768
Feb 1941
0.872
Feb 1941
0.977
Feb 1941
1.081
Jan 1941
1.138 1.202 1.257 1.530
Legend:
SWR 100% Success
95% Success
90% Success
PWR 100% Capital Protection
75%
50% Protection
25%
Period: May 1973 - Apr 2023
Swipe left to see all data
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)
1.702
Mar 2003
3.026
Mar 2003
3.631
May 1973
4.227
May 1973
4.822
May 1973
5.737 5.843 7.012 8.099
30 Years
Worst Period (from)
2.940
May 1973
3.221
May 1973
3.502
May 1973
3.783
May 1973
4.064
May 1973
4.670 4.931 5.067 6.898
Legend:
SWR 100% Success
95% Success
90% Success
PWR 100% Capital Protection
75%
50% Protection
25%
Simulations are calculated with actual returns of US Long Term (20y+) Treasuries Asset Class | Preserved capital and withdrawals are considered adjusted for inflation | Withdrawals happen monthly | Performances are calculated in USD dollars, considering reinvestment of dividends when applicable | Inflation is updated at April 2023

Withdrawals and Success Rate

If you had implemented a specific Withdrawal Strategy with the US Long Term (20y+) Treasuries 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.

Period: Jan 1871 - Apr 2023
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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.
2.276%
89.92
80% Succ.
2.362%
80.23
80% Succ.
2.002%
72.95
50% Succ.
2.330%
59.76
50% Succ.
2.069%
2.50 %
100.00
96.94
95% Succ.
2.556%
77.54
63.63
50% Succ.
2.713%
36.88
33.77
3.00 %
100.00
77.60
60.64
50% Succ.
3.289%
36.45
24.80
20.73
3.50 %
100.00
100% Succ.
3.622%
63.58
43.59
22.95
17.67
16.78
4.00 %
92.76
90% Succ.
4.171%
51.94
50% Succ.
4.079%
30.47
15.95
12.80
9.61
4.50 %
82.69
80% Succ.
4.621%
43.98
24.91
10.58
7.57
7.79
5.00 %
60.67
38.60
17.35
7.40
6.40
6.37
5.50 %
52.99
50% Succ.
5.816%
31.38
12.31
5.70
5.23
5.36
6.00 %
48.52
27.03
10.01
4.72
4.60
3.84
6.50 %
46.44
20.35
8.90
4.23
2.43
1.11
7.00 %
42.23
15.45
7.34
2.60
0.27
0.00
7.50 %
36.56
11.23
6.23
0.49
0.00
0.00
8.00 %
29.20
9.80
4.52
0.00
0.00
0.00
Period: May 1923 - Apr 2023
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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.
2.276%
81.14
80% Succ.
2.026%
59.57
50% Succ.
2.202%
37.63
22.71
2.50 %
100.00
94.65
90% Succ.
2.584%
57.98
50% Succ.
2.614%
32.28
8.94
3.32
3.00 %
100.00
60.88
50% Succ.
3.437%
40.92
17.30
0.00
0.00
3.50 %
100.00
100% Succ.
3.622%
48.87
34.95
5.49
0.00
0.00
4.00 %
88.03
80% Succ.
4.296%
44.11
22.33
0.00
0.00
0.00
4.50 %
72.11
38.41
15.40
0.00
0.00
0.00
5.00 %
54.73
50% Succ.
5.387%
33.89
8.32
0.00
0.00
0.00
5.50 %
49.22
26.75
7.07
0.00
0.00
0.00
6.00 %
43.91
22.12
5.96
0.00
0.00
0.00
6.50 %
42.25
17.48
5.96
0.00
0.00
0.00
7.00 %
40.48
13.56
5.41
0.00
0.00
0.00
7.50 %
35.80
8.80
4.85
0.00
0.00
0.00
8.00 %
27.37
8.20
3.88
0.00
0.00
0.00
Period: May 1973 - Apr 2023
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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.
4.064%
4.50 %
100.00
100% Succ.
4.822%
95.85
95% Succ.
4.670%
5.00 %
99.17
84.23
80% Succ.
5.067%
5.50 %
96.68
95% Succ.
5.737%
74.69
6.00 %
85.87
70.95
6.50 %
82.55
61.00
50% Succ.
6.898%
7.00 %
80.06
80% Succ.
7.012%
47.30
7.50 %
70.64
30.71
8.00 %
53.46
28.63
Simulations are calculated with actual returns of US Long Term (20y+) Treasuries Asset Class | Preserved capital and withdrawals are considered adjusted for inflation | Withdrawals happen monthly | Performances are calculated in USD dollars, considering reinvestment of dividends when applicable | Inflation is updated at April 2023

Related Pages

Asset Class Main Page:
US Long Term (20y+) Treasuries Asset Class

For the US Long Term (20y+) Treasuries 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

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