Savings Withdrawal Calculator

How this calculator works

The balance earns the entered monthly interest rate before each month-end withdrawal. The tool tests whether the entered schedule can fund every withdrawal. It also solves for a constant monthly withdrawal that would leave the desired final balance under the same rate. Once withdrawals cannot be covered, the remaining-balance output is capped at zero rather than treating the account as borrowing. An unreachable final target is identified separately.

Formula

r = nominal annual rate/100/12; n = years × 12. Theoretical final balance = initial(1+r)^n − withdrawal((1+r)^n − 1)/r. Target-preserving withdrawal = max(0, (initial(1+r)^n − target)/annuity factor). At 0%, the factor is n.

Assumptions & limitations

Constant nonnegative savings interest, withdrawals after monthly interest and no new deposits. No tax, inflation, fees or volatile investment sequence. This is not a safe-withdrawal-rate recommendation.

Sources & reference material

• OpenStax: annuities ↗

  Background for equal-period cash flows; not a forecast of returns or a lender APR disclosure.

Worked example

With 12,000 savings, 0% interest and a one-year horizon, withdrawing 500 monthly leaves 6,000. To retain a final 3,000 instead, the constant monthly allowance is (12,000 − 3,000) ÷ 12 = 750.

Common questions