The 4% rule is a retirement planning guideline: withdraw around 4% per year from your portfolio (adjusted over time) to reduce the risk of running out.
Try the Retirement CalculatorIf you have a $1,000,000 portfolio, 4% is about $40,000 per year. The idea is to choose a withdrawal rate that historically had a good chance of lasting across many market conditions.
Spending flexibility, market returns, fees, inflation, and your time horizon all matter. Some people use 3–3.5% for more caution.
No. It reduces risk based on past data, but future markets can differ.
If you want a more conservative plan, try 3–3.5% and see what portfolio target that implies.
It’s often discussed around 30 years, but many people adapt it. Longer retirements may need more conservative assumptions.
Many discussions assume a diversified portfolio. This site uses simplified assumptions for education.
Use /retire.html with your desired income and withdrawal rate to estimate a target nest egg.