Safe Withdrawal Rate (SWR)
Financial glossary definition
Definition
The percentage of a retirement portfolio that can be withdrawn annually without running out of money over a specified period. The commonly cited 4% rule suggests withdrawing 4% in year one, then adjusting for inflation.
Try It Yourself
FIRE Calculator
Plan your Financial Independence, Retire Early journey with precision.
Related Terms
FIRE (Financial Independence, Retire Early)
A movement focused on extreme savings and investment to achieve financial freedom decades before tra…
Gross Income
Your total income before taxes and deductions. This is the starting point for calculating your budge…
Roth IRA
An individual retirement account funded with after-tax dollars. Contributions can be withdrawn anyti…
Savings Rate
The percentage of your gross or net income that you save and invest. A higher savings rate is the mo…
Simple Interest
Interest calculated only on the original principal amount, not on accumulated interest. Simple inter…