US Small Cap: 20-year retirement

Last Update: 30 April 2023

Do you have in mind a 20 years retirement, investing in the US Small Cap asset class?

According to the historical returns and stats of the asset class, which has been a sustainable withdrawal rate to live off your investiment?

Worst case scenario so far, over a 20-year time horizon, you could have withdrawn 3.38% of your initial capital each year, kept withdrawing all the time (adjusting for inflation), and you wouldn't have run out of money before 20 years.

Considering the last 20 years (last update: April 2023), a safe withdrawal rate would have been 10.841%.

The last 20 years of the US Small Cap asset class

Over the last 20 years (last update: April 2023), the asset class has returned 10.02% annualized, with a maximum drawdown of -54.13%.

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 8.190 10.841 10.02
[ 7.29 ] 		-54.13
Jun 2007 - Feb 2009
Simulations are calculated with actual returns of US Small Cap 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

For a complete view of the asset class and all the possible strategies, please refer to US Small Cap page.

Withdrawal Rates Simulation (updated at Apr 2023)

How much would it be an acceptable withdrawal rate, for the US Small Cap asset class?

Analyzing the available data source, all the 20-years timeframes have been considered to calculate the withdrawal rates and their success percentage.

Legend:
SWR 100% Success
PWR 100% Capital Protection
Period: Jan 1871 - Apr 2023
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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%
Minimum
Worst Period (from) 		0.000
May 1901 		0.000
Jun 1912 		0.898
Jul 1912 		2.920
Sep 1929 		3.380
Sep 1929 		5.549
95% Succ. 		5.950
90% Succ. 		7.560
80% Succ. 		9.962
50% Succ.
Median 7.867
 8.411
 8.906
 9.385
 9.962
Average 8.288
 8.806
 9.329
 9.853
 10.377
Maximum
Best Period (from) 		27.616
Jul 1932 		27.943
Jul 1932 		28.269
Jul 1932 		28.595
Jul 1932 		28.921
Jul 1932
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Key
Withdrawal
Rates (%) 		Success Rate
100% 95% 90% 80% 50%
Preserved Capital 100% 0.000
 2.303
 3.378
 5.341
 7.867
75% 0.000
 3.241
 4.062
 5.869
 8.411
50% 0.898
 3.959
 4.850
 6.405
 8.906
25% 2.920
 4.734
 5.363
 6.895
 9.385
0% 3.380
 5.549
 5.950
 7.560
 9.962
Period: May 1923 - Apr 2023
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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%
Minimum
Worst Period (from) 		1.538
Sep 1929 		1.999
Sep 1929 		2.459
Sep 1929 		2.920
Sep 1929 		3.380
Sep 1929 		5.972
95% Succ. 		7.342
90% Succ. 		8.486
80% Succ. 		11.262
50% Succ.
Median 9.361
 9.857
 10.315
 10.794
 11.262
Average 9.998
 10.394
 10.789
 11.184
 11.579
Maximum
Best Period (from) 		27.616
Jul 1932 		27.943
Jul 1932 		28.269
Jul 1932 		28.595
Jul 1932 		28.921
Jul 1932
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Key
Withdrawal
Rates (%) 		Success Rate
100% 95% 90% 80% 50%
Preserved Capital 100% 1.538
 4.807
 5.949
 7.049
 9.361
75% 1.999
 5.137
 6.298
 7.413
 9.857
50% 2.459
 5.451
 6.653
 7.792
 10.315
25% 2.920
 5.720
 6.998
 8.165
 10.794
0% 3.380
 5.972
 7.342
 8.486
 11.262
Period: May 1973 - Apr 2023
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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%
Minimum
Worst Period (from) 		5.094
May 2002 		5.662
May 2002 		6.173
May 1998 		6.676
May 1998 		7.179
May 1998 		8.183
95% Succ. 		8.898
90% Succ. 		9.891
80% Succ. 		11.979
50% Succ.
Median 10.079
 10.522
 11.022
 11.539
 11.979
Average 10.664
 11.106
 11.549
 11.992
 12.435
Maximum
Best Period (from) 		20.990
Jan 1975 		21.271
Jan 1975 		21.551
Jan 1975 		21.832
Jan 1975 		22.112
Jan 1975
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Key
Withdrawal
Rates (%) 		Success Rate
100% 95% 90% 80% 50%
Preserved Capital 100% 5.094
 6.090
 6.435
 7.793
 10.079
75% 5.662
 6.648
 7.077
 8.376
 10.522
50% 6.173
 7.161
 7.691
 8.876
 11.022
25% 6.676
 7.683
 8.294
 9.380
 11.539
0% 7.179
 8.183
 8.898
 9.891
 11.979
Simulations are calculated with actual returns of US Small Cap 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 Small Cap asset class, over 20 years, 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 20-year 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
% Fail
% Success over 20 Years - on % Preserved Capital
% Success Percentile No Capital
Preserved		 0%
Preserved 		25%
Preserved 		50%
Preserved 		75%
Preserved 		100%
Preserved
2.00 %
100.00
0.00
100.00
100.00
99.81
98.36
96.66
2.50 %
100.00
0.00
100.00
100.00
99.56
97.67
94.08
3.00 %
100.00
100% Succ.
3.380% 		0.00
100.00
99.94
98.62
95.97
91.69
3.50 %
99.94
0.06
99.94
99.62
97.55
93.52
88.92
4.00 %
99.69
0.31
99.69
98.87
94.84
90.43
87.16
4.50 %
99.31
0.69
99.31
96.60
92.01
87.54
84.14
5.00 %
98.49
1.51
98.49
93.20
88.67
83.95
82.13
5.50 %
95.53
95% Succ.
5.549% 		4.47
95.53
88.99
84.52
82.25
78.79
6.00 %
89.36
10.64
89.36
85.78
82.32
78.92
73.38
6.50 %
86.15
13.85
86.15
83.20
79.42
74.26
66.58
7.00 %
83.83
16.17
83.83
79.30
74.70
67.78
60.79
7.50 %
80.68
80% Succ.
7.560% 		19.32
80.68
75.27
68.16
60.79
55.38
8.00 %
75.96
24.04
75.96
68.79
61.49
54.94
48.58
Legend: Min% of Protected Capital
Min 0%
Min 25%
Min 50%
Min 75%
Min 100%
Period: May 1923 - Apr 2023
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Withdrawal
Rate
20 Years
% Fail
% Success over 20 Years - on % Preserved Capital
% Success Percentile No Capital
Preserved		 0%
Preserved 		25%
Preserved 		50%
Preserved 		75%
Preserved 		100%
Preserved
2.00 %
100.00
0.00
100.00
100.00
100.00
99.90
99.58
2.50 %
100.00
0.00
100.00
100.00
99.90
99.58
98.86
3.00 %
100.00
100% Succ.
3.380% 		0.00
100.00
99.90
99.58
98.86
98.44
3.50 %
99.90
0.10
99.90
99.58
98.86
98.34
97.29
4.00 %
99.48
0.52
99.48
98.86
98.13
97.09
96.57
4.50 %
98.86
1.14
98.86
97.81
96.98
96.25
95.84
5.00 %
97.71
2.29
97.71
96.88
96.05
95.21
94.28
5.50 %
96.46
95% Succ.
5.972% 		3.54
96.46
95.63
94.59
93.55
92.40
6.00 %
94.90
5.10
94.90
93.86
93.34
91.47
89.59
6.50 %
93.65
6.35
93.65
92.61
90.95
88.76
84.81
7.00 %
91.99
90% Succ.
7.342% 		8.01
91.99
89.91
88.03
84.50
80.33
7.50 %
89.07
10.93
89.07
87.20
82.62
78.88
75.13
8.00 %
85.64
14.36
85.64
81.69
77.73
73.88
67.22
Legend: Min% of Protected Capital
Min 0%
Min 25%
Min 50%
Min 75%
Min 100%
Period: May 1973 - Apr 2023
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Withdrawal
Rate
20 Years
% Fail
% Success over 20 Years - on % Preserved Capital
% Success Percentile No Capital
Preserved		 0%
Preserved 		25%
Preserved 		50%
Preserved 		75%
Preserved 		100%
Preserved
2.00 %
100.00
0.00
100.00
100.00
100.00
100.00
100.00
2.50 %
100.00
0.00
100.00
100.00
100.00
100.00
100.00
3.00 %
100.00
0.00
100.00
100.00
100.00
100.00
100.00
3.50 %
100.00
0.00
100.00
100.00
100.00
100.00
100.00
4.00 %
100.00
0.00
100.00
100.00
100.00
100.00
100.00
4.50 %
100.00
0.00
100.00
100.00
100.00
100.00
100.00
5.00 %
100.00
0.00
100.00
100.00
100.00
100.00
100.00
5.50 %
100.00
0.00
100.00
100.00
100.00
100.00
98.61
6.00 %
100.00
0.00
100.00
100.00
100.00
98.61
95.84
6.50 %
100.00
0.00
100.00
100.00
98.89
96.68
89.20
7.00 %
100.00
100% Succ.
7.179% 		0.00
100.00
98.89
96.68
90.30
87.26
7.50 %
99.17
0.83
99.17
96.68
91.14
87.26
83.93
8.00 %
96.95
3.05
96.95
91.97
87.53
83.93
76.73
Legend: Min% of Protected Capital
Min 0%
Min 25%
Min 50%
Min 75%
Min 100%
Simulations are calculated with actual returns of US Small Cap 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 Small Cap Asset Class

For the US Small Cap 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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