If you already have a portfolio, you can estimate a reasonable income range using 3%, 4%, and 5% withdrawal scenarios.
Use the Retirement CalculatorAnnual income ≈ portfolio × withdrawal rate. Try 3%, 4%, and 5% to see a range.
| Portfolio size | 3% withdrawal | 4% withdrawal | 5% withdrawal |
|---|---|---|---|
| $100,000 | $3,000/yr | $4,000/yr | $5,000/yr |
| $250,000 | $7,500/yr | $10,000/yr | $12,500/yr |
| $500,000 | $15,000/yr | $20,000/yr | $25,000/yr |
| $750,000 | $22,500/yr | $30,000/yr | $37,500/yr |
| $1,000,000 | $30,000/yr | $40,000/yr | $50,000/yr |
| $1,500,000 | $45,000/yr | $60,000/yr | $75,000/yr |
| $2,000,000 | $60,000/yr | $80,000/yr | $100,000/yr |
| $2,500,000 | $75,000/yr | $100,000/yr | $125,000/yr |
The amount of income your portfolio can sustainably generate depends on your withdrawal rate — the percentage you draw down each year. The widely used 4% rule suggests withdrawing 4% annually, which historical data shows a balanced portfolio can sustain for 30+ years without running out. A more conservative 3% withdrawal gives extra buffer for longevity and market downturns, while 5% gives more income but carries more risk of depleting the portfolio over time. For Australians, a $1,500,000 portfolio at 4% generates $60,000 a year — a comfortable retirement income for most people with a paid off home. Use the retirement calculator above to model how long your specific portfolio would last at different withdrawal rates.
A single number can be misleading. A conservative plan should still work if returns are lower than expected.
Use both. 3% is conservative. 4% is a common guideline. Compare the range.
Not automatically. If you expect guaranteed income later, subtract it from what your portfolio must provide.
No — it’s a scenario model to help you plan. Real returns vary.
Lower spending, delay retirement, increase contributions, or plan a partial retirement approach.
Choose a conservative plan you can stick with, then increase contributions gradually.