Sequence of returns risk calculator
Enter annual returns and a withdrawal. This shows what the same returns do in four different orders, then runs a repeatable range of shuffled paths and solves the withdrawal your success target actually supports.
Worked example — Same 10 returns, reordered, finish: 2.16x apart. $1,000,000 portfolio, $45,000 first-year withdrawal, the same 10 annual returns in best against worst order
Stress-test withdrawals
Run the withdrawal against the order of returns instead of trusting one average.
See all four FIRE stages
Standard $1M portfolio: The page's own default: a round-number portfolio at a conservative 4.5% initial draw.
10 returns. Commas or spaces. These are the years the reordering panel uses.
Future simulation assumptions 6
See the return averages
The arithmetic average is 5.50% a year either way and the compounded average is 4.10%. Reordering them still creates a $592,565 ending gap because withdrawals remove money before later recoveries can act on it.
Four orderings of the same 10 returns
5,000 simulated retirements over 30 years: the median path, the 10th-90th percentile band, and the constant-return answer
Does the order of investment returns matter in retirement?
Yes, once withdrawals are involved. Reordering the identical set of annual returns changes the ending balance, because a loss early in retirement removes capital that never gets the chance to compound back, while the same loss arriving late does far less damage. Without withdrawals, order cannot matter at all: multiplication commutes, so the control column in the tool above proves it to the cent. The live ordering table is the proof, run on whatever returns and withdrawal you enter.
Safe withdrawal rate by target success probability
The withdrawal that survives each success target, solved by the same seeded Monte Carlo the calculator runs, on a $1,000,000 portfolio over 30 years at a 7% expected return and 16% volatility. A higher success target always solves for a lower withdrawal.
| Target success | Safe withdrawal | As a rate |
|---|---|---|
| 80% | $35,674 | 3.57% |
| 90% | $29,066 | 2.91% |
| 95% | $24,354 | 2.44% |
| 99% | $17,402 | 1.74% |
What this does not model
- Returns are drawn independently each year from a lognormal distribution, so there is no autocorrelation, no mean reversion, and no fat tails.
- No correlation between a bad market and the inflation that indexes the withdrawal.
- No taxes, no fees, no changing asset allocation, no annuity, and no Social Security.
- No ability to cut spending in a bad year, the single most effective real-world response to this risk.
- Success means never hitting zero (or the bequest floor you set), so a plan that ends at one dollar still counts as a pass.
The average return assumed is nearly irrelevant to a retiree; the first five to ten years carry almost the entire risk. Hold enough in short-duration assets to fund several years of withdrawals without selling into a decline, and treat the solved safe withdrawal above as a ceiling rather than a plan. This is the stress-test step of a FIRE plan; the target and coast calculators it tests sit on the FIRE calculators hub.
What Pro adds here
Bootstrapped return blocks, spending-rule variants that cut withdrawals in a drawdown, and glide paths across the same seeded engine are Pro features. The launch list sends one email at launch.