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The Classic 4% Rule

Does the famous safe withdrawal rate hold up?

Age

Location

Austin, TX

Income

$120k/yr

Saved

$800k

A 45-year-old in Austin earns $120k, has saved $800k across taxable and tax-deferred accounts, and spends $60k per year — a textbook 4% scenario. Texas has no income tax, which meaningfully extends the runway. Can they retire before 65?

What the projection shows

The earliest retirement age at which this plan does not run out of money is 51, after 6 more years of full-time work. Market risk matters more than that headline: the earliest age that succeeds in at least 80% of 500 Monte Carlo simulations is 53.

Retirement age options for The Classic 4% Rule
Retire at	Full-time years left	Best Monte Carlo success
51	6	65%
52	7	79%
53	8	86%
54	9	91%

How the plan works (retiring at 53)

EARLIEST 80%+ PLAN: Retire at Age 53 Switch to semi-retirement at age 53 (after 8 high-salary years). Portfolio bridges to full retirement at 53.

Growth rate (7.0%) keeps compounding during spending — the extra buffer matters most against bad early-retirement market sequences.

Social Security: $35k/yr starting at age 67 is included. Healthcare: $12k/yr before Medicare at 65.

Portfolio range over time

Across the simulated market histories (in future dollars, not adjusted for inflation), the median portfolio is $3.10M at 70, $4.42M at 80, $5.76M at 90. In a poor sequence of returns (10th percentile) it is $449k at 70, $259k at 80, $0k at 90.

Related example plans

The Late Starter — Catching Up at 52 — Divorced, $180k saved — is retirement still possible?
Five Years to the Finish Line — A 60-year-old couple stress-testing their plan
Already Retired — Am I OK? — Retired at 58, $1.1M, worried about lasting to 95
Coast FIRE — Investments Do the Heavy Lifting — Downshifted at 33, letting $350k grow untouched
The Conservative Stress Test — What if returns are lower and inflation is real?
Go-Go, Slow-Go, No-Go — Retirement spending naturally declines — does your plan reflect that?

This example uses illustrative figures and should not be treated as financial advice.