About & Methodology

About Retire Forever

Retire Forever is an independent educational website created to make retirement-income planning and the Variable Percentage Withdrawal (VPW) strategy easier to understand.

Retire Forever is operated from Ohio, United States. Questions and feedback may be sent to retireforevercontact@gmail.com.

Retire Forever is not a financial adviser. The website is provided for educational and informational purposes only.

An Interactive Approach to VPW

Retire Forever brings the VPW methodology into an accessible, interactive planning experience – without requiring users to build or navigate a spreadsheet. It combines full-precision VPW calculations with historical retirement simulations that account for future Social Security and pension income, investment expenses, and changing asset allocations.

Optional settings allow users to explore different inflation assumptions and VPW alterations, including withdrawal caps and floors. These controls make it possible to evaluate how personal spending preferences and planning assumptions may affect retirement income and portfolio sustainability.

Retire Forever helps users:

• Calculate a current VPW recommended withdrawal.
• Explore how market gains or losses could affect the next recommendation.
• Test assumptions across historical retirement simulations.
• Understand the income variability experienced during difficult markets.
• Compare multiple scenarios and evaluate VPW alongside a fixed, inflation-adjusted withdrawal strategy.

The results are designed to show more than whether a portfolio avoided depletion. Interactive charts illustrate the range and variability of retirement income and the effects of difficult historical periods.

Retire Forever does not replace the original VPW resources. It builds upon the publicly documented methodology by making its calculations and historical implications easier to explore and understand.

How the VPW recommendation is calculated

VPW converts the remaining retirement portfolio into a series of annual withdrawals through age 99. The method and its spreadsheets were collaboratively developed by members of the Bogleheads® community. Additional background is available in the Bogleheads VPW wiki. Retire Forever is an independent educational website and is not affiliated with or endorsed by the Bogleheads organization or community.

The recommended percentage generally increases with age because fewer retirement years remain. The calculation uses:

• Current age and portfolio balance
• Current asset allocation
• Expected real returns of 5% for equities and 1.9% for bonds
• Social Security and pension income
• The present value of current and future income payments
• The selected investment expense ratio
• Optional withdrawal caps and floors

VPW percentages are calculated at full precision rather than rounding the percentage before applying it to the portfolio. The recommendation is intended to be recalculated annually using an updated age, portfolio balance, asset allocation, and income information.

Treatment of Social Security and pensions

Social Security and pension payments are included using the present value of expected future payments. This allows the calculator to consider income that has not started yet. Current payments reduce the amount that must come from the portfolio, while future payments affect the amount of portfolio funding required later in retirement.

The calculator does not determine Social Security eligibility, benefit taxation, survivor benefits, claiming strategy, or the financial strength of an income provider. Users are responsible for entering reasonable benefit amounts and payment periods.

Historical retirement simulations

The backtest evaluates how the selected inputs would have performed across every complete historical retirement period available in the dataset. Each simulation begins in a different calendar year and follows the actual sequence of Total U.S. Stock Market returns, intermediate-term U.S. bond returns, and inflation.

The current dataset spans 1871 through 2025. A 45-year retirement, for example, uses only starting years for which all 45 historical years are available. Incomplete retirement periods are not included.

This approach captures real historical events such as the Great Depression, periods of high inflation, major market crashes, and long bull markets. It is not a Monte Carlo forecast and does not assign probabilities to future outcomes.

Annual simulation sequence

For each retirement year, the simulator:

1. Begins with the portfolio balance carried forward from the end of the previous year. For the first year, this is the Portfolio Balance entered by the user.
2. Determines the applicable asset allocation and income payments for that year.
3. Calculates the VPW recommended withdrawal using the beginning portfolio balance, current age, asset allocation, and present value of current and future income.
4. Applies any withdrawal floor or Target Spend cap and limits the withdrawal to the available portfolio balance.
5. Deducts the resulting portfolio withdrawal at the beginning of the year.
6. Applies that historical year's stock and bond returns, less investment expenses, to the portfolio remaining after the withdrawal.
7. Records the result as the year-end portfolio balance, which becomes the following year's beginning balance.
8. Combines the portfolio withdrawal with Social Security and pension payments to calculate total retirement income.
9. Converts applicable results to starting-year dollars for real-dollar reporting.
10. Advances the simulation to the next age and historical calendar year.

The withdrawal is deducted before that year's return is applied. The annual amount may be spent throughout the year, but the historical simulation does not model monthly or quarterly market movements.

Real-dollar reporting

Unless otherwise stated, results are shown in real starting-year dollars. This removes the effect of inflation so income and portfolio values from later retirement years can be compared with the purchasing power of money at the beginning of retirement.

VPW success and portfolio depletion

A VPW simulation is considered successful when the portfolio avoids depletion before the planned final withdrawal. VPW is designed to spend the remaining portfolio through age 99, so planned depletion following the final withdrawal at age 99 is not treated as a failure.

A withdrawal floor can force spending above the VPW recommendation. If that causes the portfolio to be depleted before the final retirement year, the simulation is treated as a failure.

Fixed-withdrawal benchmark

The fixed-withdrawal benchmark provides a secondary comparison. It attempts to withdraw the inflation-adjusted Target Spend every year instead of adjusting withdrawals according to VPW. It succeeds when the full Target Spend can be funded throughout the selected retirement horizon and fails when the portfolio can no longer fund the required withdrawal before the horizon ends.

Interpreting differences between simulators

Historical simulations demonstrate what would have happened under the modeled assumptions. They do not predict what will happen in the future. Results may differ from other calculators because tools can use different market datasets, indexes, inflation series, withdrawal timing, investment expenses, calculation precision, income-valuation methods, and definitions of success and failure. Small methodological differences can compound over a long retirement.

Important limitations

The simulator does not model every factor that may affect a real retirement, including:

• Federal, state, or local taxes
• Account-specific tax treatment and required minimum distributions
• Trading costs or adviser fees beyond the entered expense ratio
• Intra-year market volatility
• Changes in tax or benefit laws
• Long-term care or unexpected expenses
• Social Security benefit reductions or pension default risk
• Individual holdings, tracking error, or irregular withdrawals

Users should consider these limitations and consult qualified professionals before making financial decisions.

Calculation review

VPW calculations use full-precision percentages and have been reviewed against the original VPW spreadsheet methodology. During development, the simulator was checked using scenarios involving withdrawal caps, withdrawal floors, future income, extreme historical market conditions, early portfolio depletion, and the planned final withdrawal at age 99.