How Long Will $500,000 Last in Retirement?
There is no single answer. How long a $500,000 account lasts depends on monthly withdrawals, investment returns, inflation, fees, taxes and other retirement income.
For example, taking a fixed $2,000 per month ($24,000 per year, or 4.8%) with a 5% net investment return and 2.5% inflation could last approximately 26 years. However, increasing withdrawals to $3,500 per month ($42,000 per year) might deplete the account in under 14 years under the same market conditions.
How Long Will $1 Million Last in Retirement?
The answer depends on how quickly money is withdrawn and how the remaining account performs. A $1 million balance does not automatically translate to a specific number of retirement years.
At a 4% initial withdrawal ($40,000 per year, or $3,333/month) adjusted annually for 2.5% inflation with a 5% return, a $1,000,000 portfolio could last over 30 years. But if monthly spending is $6,000 ($72,000/year, or 7.2%), the portfolio may be depleted in approximately 17 years.
How Much Can I Withdraw From My 401(k) Each Month?
There is no universal monthly amount that works for every retirement. The amount that can be withdrawn before the account reaches zero depends on starting balance, retirement horizon, market returns, inflation, fees, taxes and outside income.
Use the Solve for Monthly Withdrawal feature in this calculator to test what level of monthly income aligns with your target retirement horizon.
Does a Roth 401(k) Last Longer Than a Traditional 401(k)?
Not automatically. If a qualified Roth distribution is tax-free, less gross account withdrawal is required to produce the same spendable take-home income compared with a fully taxable Traditional withdrawal.
For example, to net $4,000 per month of spendable cash with a 20% modeled income tax, a Traditional 401(k) must distribute $4,000 / (1 - 0.20) = $5,000 gross. A qualified Roth account only distributes $4,000 gross. That $1,000/month lower drain leaves more money compounding inside the Roth account, which can extend its longevity. However, contribution limits and tax deductions during working years also differ.
How Do Social Security and Pensions Affect 401(k) Longevity?
Outside retirement income can substantially reduce the amount you must pull from your 401(k). If your household requires $5,000 per month to live comfortably and Social Security provides $2,000 per month after taxes, only $3,000 per month must be withdrawn from your 401(k).
This calculator lets you model delayed outside income (for instance, retiring at 65 but delaying Social Security until 67 or 70) to see how early bridge withdrawals impact long-term balances.
What Is Sequence-of-Returns Risk?
A steady average return can hide an important risk. Two retirement portfolios can earn the exact same 30-year average annual return, but produce wildly different results if one experiences major market declines early in retirement.
When you sell investments to fund withdrawals while the market is down, those shares are permanently eliminated and cannot recover when the market rebounds. Use the Early-Retirement Stress Test toggle under Advanced assumptions to evaluate your portfolio against potential early headwinds.
Could Required Minimum Distributions (RMDs) Change Longevity?
Yes. Traditional 401(k) accounts generally become subject to mandatory IRS distribution minimums at the applicable statutory age. Under SECURE 2.0:
- Age 73 for individuals born from 1951 through 1959.
- Age 75 for individuals born in 1960 or later.
If the statutory RMD exceeds your planned withdrawal, the larger RMD amount must leave the plan, accelerating distribution from the account. Designated Roth 401(k) accounts are exempt from lifetime RMDs under SECURE 2.0 Section 325.
What This Calculator Cannot Predict
This tool provides deterministic mathematical projections based on the constant assumptions you enter. It cannot predict future economic cycles, variable stock and bond returns, changing inflation rates, future tax laws, unexpected medical expenses, or personal longevity.
This tool is for educational purposes only and does not constitute individualized investment, financial, or tax advice.