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

Last Update: 30 November 2024

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

Worst case scenario so far, over a 40-year time horizon, you could have withdrawn 3.423% of your initial capital each year, kept withdrawing all the time (adjusting for inflation), and you wouldn't have run out of money before 40 years.

With a 4% withdrawal strategy, you would have lived on your investiment for 40 years in the 78% of cases. In the 35.89% of cases, you would have preserved your initial inflation adjusted capital.

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

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

Over the last 40 years (last update: November 2024), the portfolio has returned 8.33% annualized, with a maximum drawdown of -21.12%.

A safe withdrawal rate would have been 7.627%.

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 Nov 2024
Withdrawal Rate (%)
Investment Performances
Timeframe Period from Period to Perpetual Safe Ann.Return(%)
[ Infl.Adj. ]		 Max
Drawdown(%)
40 Years 1 Dec 1984
 30 Nov 2024 6.698 7.627 8.33
[ 5.40 ] 		-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 November 2024

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 Nov 2024)

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

Analyzing the available data source, all the 40-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 - Nov 2024
Period: Dec 1924 - Nov 2024
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WR (%) - Withdrawal Rate, on % Preserved Capital (Infl.Adj)
100%
Preserved		 75%
Preserved		 50%
Preserved		 25%
Preserved		 0%
Preserved
Success 100%
Worst Period (From) 		1.846
Apr 1940 		2.316
Apr 1940 		2.785
Apr 1940 		3.172
Mar 1937 		3.423
Jul 1901
95%
 2.521
 2.842
 3.132
 3.422
 3.691
90%
 2.731
 3.006
 3.269
 3.525
 3.789
80%
 2.972
 3.219
 3.477
 3.714
 3.952
50%
Median WR 		3.529
 3.780
 4.024
 4.302
 4.589
Only 1 case
Best Period (From) 		8.430
Oct 1981 		8.610
Oct 1981 		8.834
Jul 1982 		9.069
Jul 1982 		9.304
Jul 1982
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WR (%) - Withdrawal Rate, on % Preserved Capital (Infl.Adj)
100%
Preserved		 75%
Preserved		 50%
Preserved		 25%
Preserved		 0%
Preserved
Success 100%
Worst Period (From) 		1.846
Apr 1940 		2.316
Apr 1940 		2.785
Apr 1940 		3.172
Mar 1937 		3.539
Mar 1937
95%
 2.282
 2.669
 3.069
 3.433
 3.719
90%
 2.578
 2.924
 3.251
 3.522
 3.787
80%
 2.963
 3.217
 3.477
 3.700
 3.948
50%
Median WR 		3.580
 3.787
 3.995
 4.272
 4.570
Only 1 case
Best Period (From) 		8.430
Oct 1981 		8.610
Oct 1981 		8.834
Jul 1982 		9.069
Jul 1982 		9.304
Jul 1982
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 November 2024

Withdrawals and Success Rate

If you had implemented a specific Withdrawal Strategy with the US Stocks/Bonds 40/60 Portfolio, over 40 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 40-year timeframes available in the data source. To focus on a specific withdrawal rate, click on the links in the table.

Period: Jan 1871 - Nov 2024
Period: Dec 1924 - Nov 2024
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Withdrawal
Rate
% Success over 40 Years
% Fail
% Success over 40 Years - on % Preserved Capital (Infl.Adj)
At least 0%
Capital Preserved		 Percentile No Capital
Preserved		 25%
Preserved 		50%
Preserved 		75%
Preserved 		100%
Preserved
2.00 %
100.00
0.00
100.00
100.00
100.00
99.78
2.50 %
100.00
0.00
100.00
100.00
99.42
95.10
3.00 %
100.00
100% Succ.
3.423% 		0.00
100.00
98.17
90.35
78.00
3.50 %
99.85
95% Succ.
3.691% 		0.15
91.45
78.22
63.08
51.39
4.00 %
78.00
22.00
61.99
50.51
43.27
35.89
4.50 %
53.14
50% Succ.
4.589% 		46.86
44.37
37.50
30.56
26.10
5.00 %
38.30
61.70
33.04
28.14
24.78
22.51
5.50 %
30.56
69.44
25.73
21.78
20.25
18.27
6.00 %
22.81
77.19
19.74
17.84
15.64
13.96
6.50 %
17.25
82.75
15.28
13.45
11.70
10.38
7.00 %
13.16
86.84
11.70
10.01
7.97
6.29
7.50 %
9.72
90.28
7.53
5.92
3.80
2.34
8.00 %
5.56
94.44
3.51
1.97
1.10
0.51
Legend: Min% of Protected Capital
Min 0%
Min 25%
Min 50%
Min 75%
Min 100%
Swipe left to see all data
Withdrawal
Rate
% Success over 40 Years
% Fail
% Success over 40 Years - on % Preserved Capital (Infl.Adj)
At least 0%
Capital Preserved		 Percentile No Capital
Preserved		 25%
Preserved 		50%
Preserved 		75%
Preserved 		100%
Preserved
2.00 %
100.00
0.00
100.00
100.00
100.00
99.58
2.50 %
100.00
0.00
100.00
100.00
98.89
90.98
3.00 %
100.00
0.00
100.00
96.81
88.77
77.81
3.50 %
100.00
100% Succ.
3.539% 		0.00
91.26
78.09
64.36
54.23
4.00 %
78.22
21.78
64.08
49.79
43.69
35.64
4.50 %
52.43
50% Succ.
4.570% 		47.57
43.27
35.78
27.60
24.27
5.00 %
35.78
64.22
27.88
24.41
22.47
19.56
5.50 %
23.99
76.01
20.94
18.17
15.67
12.76
6.00 %
17.20
82.80
14.70
11.65
10.54
10.26
6.50 %
10.96
89.04
10.40
9.43
8.18
7.21
7.00 %
8.88
91.12
8.18
6.38
5.27
3.74
7.50 %
6.24
93.76
4.58
3.19
2.77
1.94
8.00 %
3.19
96.81
2.50
1.80
1.53
0.97
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 November 2024

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:
10-Year    20-Year    30-Year    40-Year    50-Year    60-Year    70-Year    80-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