Retired in › 1900

Retiring in 1900: did the 4% rule survive?

Retiring at the start of 1900 with $1M and spending $40,000 a year adjusted for inflation (the 4% rule), a 100% stock portfolio lasted all 30 years, with $2.6M left; a 60/40 portfolio lasted all 30 years, with $1.0M left.

Over the first 10 years, stocks returned 7.2% a year after inflation and the 60/40 mix 4.9%. The first decade matters most: losses early, while withdrawals continue, are what break a plan.

The highest fixed rate that lasted 30 years from 1900 was at least 6% with all stocks and 5.25% with 60/40 (tested in 0.25% steps from 3% to 6%).

← 1899 · 1901 → · The 4% rule over 30 years · All start years

Questions

What happened if you retired in 1900 with the 4% rule?

Retiring at the start of 1900 with $1M and spending $40,000 a year adjusted for inflation (the 4% rule), a 100% stock portfolio lasted all 30 years, with $2.6M left; a 60/40 portfolio lasted all 30 years, with $1.0M left.

What was a safe withdrawal rate for someone retiring in 1900?

The highest fixed rate that lasted 30 years from 1900 was at least 6% with all stocks and 5.25% with 60/40 (tested in 0.25% steps from 3% to 6%).