US Stocks/Bonds 40/60 Portfolio: 20-year retirement

Last Update: 28 February 2023

Do you have in mind a 20 years retirement, investing in the US Stocks/Bonds 40/60 Portfolio?

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

Key Points

Worst case scenario so far, over a 20-year time horizon, you could have withdrawn 4.823% of your initial capital each year, kept withdrawing all the time (adjusting for inflation), and you wouldn't have run out of money before 20 years.

With a 4% withdrawal strategy, you would have lived on your investiment for 20 years in the 100% of cases. In the 48.33% of cases, you would have preserved your initial inflation adjusted capital.

The last 20 years of the US Stocks/Bonds 40/60 Portfolio

Over the last 20 years (last update: February 2023), the portfolio has returned 6.15% annualized, with a maximum drawdown of -21.12%.

A safe withdrawal rate would have been 7.572%.

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 portfolio didn't run out of money during retirement. The portfolio went to zero exaclty at the end of the retirement period.

Learn more about Withdrawal Rate simulation
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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 3.823 7.572 6.15
[ 3.58 ] 		-21.12
Nov 2007 - Feb 2009
Simulations are calculated with actual returns of US Stocks/Bonds 40/60 Portfolio | Preserved capital and withdrawals are considered adjusted for inflation | Withdrawals happen monthly | Performances are calculated in USD dollars, considering reinvestment of dividends when applicable | Portfolio is rebalanced each month | Inflation is updated at January 2023

For a complete view of the portfolio and all the possible strategies, please refer to US Stocks/Bonds 40/60 Portfolio page.

Withdrawal Rates Simulation (updated at Feb 2023)

How much would it be an acceptable withdrawal rate, for the US Stocks/Bonds 40/60 Portfolio?

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 - Feb 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
Jan 1899 		0.644
Jul 1901 		2.157
Jul 1901 		3.670
Jul 1901 		4.823
Jul 1911 		5.175
95% Succ. 		5.377
90% Succ. 		5.741
80% Succ. 		7.330
50% Succ.
Median 3.891
 4.761
 5.641
 6.497
 7.330
Average 4.226
 5.042
 5.865
 6.687
 7.510
Maximum
Best Period (from) 		10.054
Jul 1982 		10.670
Jul 1982 		11.286
Jul 1982 		11.902
Jul 1982 		12.518
Jul 1982
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Key
Withdrawal
Rates (%) 		Success Rate
100% 95% 90% 80% 50%
Preserved Capital 100% 0.000
 1.062
 1.472
 2.368
 3.891
75% 0.644
 2.135
 2.556
 3.253
 4.761
50% 2.157
 3.240
 3.548
 4.049
 5.641
25% 3.670
 4.274
 4.511
 4.874
 6.497
0% 4.823
 5.175
 5.377
 5.741
 7.330
Period: Mar 1923 - Feb 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
Oct 1961 		1.441
Oct 1961 		2.875
Apr 1962 		4.026
May 1965 		4.845
Sep 1968 		5.162
95% Succ. 		5.462
90% Succ. 		5.882
80% Succ. 		7.224
50% Succ.
Median 3.806
 4.648
 5.521
 6.414
 7.224
Average 4.137
 4.964
 5.790
 6.616
 7.443
Maximum
Best Period (from) 		10.054
Jul 1982 		10.670
Jul 1982 		11.286
Jul 1982 		11.902
Jul 1982 		12.518
Jul 1982
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Key
Withdrawal
Rates (%) 		Success Rate
100% 95% 90% 80% 50%
Preserved Capital 100% 0.000
 1.316
 1.965
 2.480
 3.806
75% 1.441
 2.395
 2.807
 3.370
 4.648
50% 2.875
 3.416
 3.686
 4.182
 5.521
25% 4.026
 4.328
 4.594
 5.082
 6.414
0% 4.845
 5.162
 5.462
 5.882
 7.224
Period: Mar 1973 - Feb 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) 		2.736
Apr 2000 		3.569
Apr 2000 		4.292
Mar 1973 		4.881
Mar 1973 		5.471
Mar 1973 		6.221
95% Succ. 		6.411
90% Succ. 		6.950
80% Succ. 		8.319
50% Succ.
Median 5.326
 6.078
 6.867
 7.618
 8.319
Average 5.543
 6.245
 6.947
 7.649
 8.351
Maximum
Best Period (from) 		10.054
Jul 1982 		10.670
Jul 1982 		11.286
Jul 1982 		11.902
Jul 1982 		12.518
Jul 1982
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Key
Withdrawal
Rates (%) 		Success Rate
100% 95% 90% 80% 50%
Preserved Capital 100% 2.736
 3.201
 3.457
 3.847
 5.326
75% 3.569
 3.971
 4.137
 4.607
 6.078
50% 4.292
 4.708
 4.901
 5.430
 6.867
25% 4.881
 5.460
 5.673
 6.203
 7.618
0% 5.471
 6.221
 6.411
 6.950
 8.319
Simulations are calculated with actual returns of US Stocks/Bonds 40/60 Portfolio | Preserved capital and withdrawals are considered adjusted for inflation | Withdrawals happen monthly | Performances are calculated in USD dollars, considering reinvestment of dividends when applicable | Portfolio is rebalanced each month | Inflation is updated at January 2023

Withdrawals and Success Rate

If you had implemented a specific Withdrawal Strategy with the US Stocks/Bonds 40/60 Portfolio, 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 - Feb 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
96.16
85.76
2.50 %
100.00
0.00
100.00
100.00
99.50
90.86
78.07
3.00 %
100.00
0.00
100.00
100.00
97.92
83.87
68.30
3.50 %
100.00
0.00
100.00
100.00
90.67
74.86
57.34
4.00 %
100.00
0.00
100.00
99.56
81.10
63.01
48.33
4.50 %
100.00
100% Succ.
4.823% 		0.00
100.00
90.23
70.26
53.69
42.22
5.00 %
97.98
95% Succ.
5.175% 		2.02
97.98
77.19
60.49
46.19
34.34
5.50 %
86.52
80% Succ.
5.741% 		13.48
86.52
67.36
51.86
39.13
26.53
6.00 %
74.80
25.20
74.80
57.59
44.05
31.51
20.60
6.50 %
66.86
33.14
66.86
49.91
35.73
22.62
16.38
7.00 %
56.14
50% Succ.
7.330% 		43.86
56.14
41.40
27.47
17.96
12.67
7.50 %
46.69
53.31
46.69
32.07
19.85
13.61
9.70
8.00 %
38.69
61.31
38.69
23.25
15.75
10.46
6.68
Legend: Min% of Protected Capital
Min 0%
Min 25%
Min 50%
Min 75%
Min 100%
Period: Mar 1923 - Feb 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
97.92
89.49
2.50 %
100.00
0.00
100.00
100.00
100.00
93.86
79.40
3.00 %
100.00
0.00
100.00
100.00
99.27
86.99
67.85
3.50 %
100.00
0.00
100.00
100.00
93.65
76.69
57.34
4.00 %
100.00
0.00
100.00
100.00
84.81
63.68
47.24
4.50 %
100.00
100% Succ.
4.845% 		0.00
100.00
91.78
73.88
52.97
41.83
5.00 %
97.81
95% Succ.
5.162% 		2.19
97.81
81.48
60.98
45.47
31.63
5.50 %
89.28
80% Succ.
5.882% 		10.72
89.28
70.45
50.68
38.29
22.06
6.00 %
78.15
21.85
78.15
57.02
43.70
27.89
16.02
6.50 %
68.68
31.32
68.68
48.49
34.13
18.00
12.70
7.00 %
55.57
50% Succ.
7.224% 		44.43
55.57
40.48
23.73
14.15
8.64
7.50 %
45.68
54.32
45.68
29.97
15.50
9.78
5.93
8.00 %
38.29
61.71
38.29
19.15
12.07
6.76
3.54
Legend: Min% of Protected Capital
Min 0%
Min 25%
Min 50%
Min 75%
Min 100%
Period: Mar 1973 - Feb 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
99.17
3.50 %
100.00
0.00
100.00
100.00
100.00
100.00
88.64
4.00 %
100.00
0.00
100.00
100.00
100.00
93.63
77.84
4.50 %
100.00
0.00
100.00
100.00
98.89
83.38
74.52
5.00 %
100.00
100% Succ.
5.471% 		0.00
100.00
99.45
88.37
76.45
62.33
5.50 %
99.72
0.28
99.72
93.35
79.22
68.14
43.49
6.00 %
97.51
95% Succ.
6.221% 		2.49
97.51
83.66
73.41
53.74
30.47
6.50 %
88.64
80% Succ.
6.950% 		11.36
88.64
76.45
60.66
34.63
24.10
7.00 %
79.50
20.50
79.50
65.37
45.15
25.76
21.05
7.50 %
69.25
30.75
69.25
54.02
28.81
21.05
15.79
8.00 %
60.11
39.89
60.11
35.73
22.16
17.17
9.42
Legend: Min% of Protected Capital
Min 0%
Min 25%
Min 50%
Min 75%
Min 100%
Simulations are calculated with actual returns of US Stocks/Bonds 40/60 Portfolio | Preserved capital and withdrawals are considered adjusted for inflation | Withdrawals happen monthly | Performances are calculated in USD dollars, considering reinvestment of dividends when applicable | Portfolio is rebalanced each month | Inflation is updated at January 2023

Related Pages

Portfolio Main Page:
US Stocks/Bonds 40/60 Portfolio

For the US Stocks/Bonds 40/60 Portfolio, 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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