Misprise · Financial calculator
Compound Interest Calculator with Withdrawals
Model retirement drawdowns and compounding with regular withdrawals, inflation, and optional deposits — including a yearly or weekly timeline, depletion date, and sustainable rate.
| Year | Start Balance | Interest | Deposits | Withdrawals | End Balance |
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What is a compound interest calculator with withdrawals?
A compound interest calculator with withdrawals goes beyond the standard compound interest formula by factoring in regular money you take out of the account. Use it for retirement drawdowns, living off an investment portfolio, or modelling a savings account with regular transfers.
The core question it answers is: if I start with a given balance, earn compound interest, and withdraw a regular amount, how long will my money last — and what will the balance be at any point in time? The free calculator above answers that instantly, with a live chart, depletion date, sustainable withdrawal rate, and a yearly or weekly timeline.
Last updated 13 August 2026.
How compound interest with withdrawals works
Each compounding period, two things happen: your balance earns interest, and you withdraw a fixed amount. Whether the interest outpaces the withdrawals determines whether your balance grows, holds steady, or eventually depletes.
The core formula per period
With additional deposits
With inflation-adjusted withdrawals
Key insight: if your annual withdrawal rate is lower than your annual interest rate, your balance will grow indefinitely. If it is higher, your balance will eventually reach zero. The crossover point — where interest exactly equals withdrawals — is the sustainable withdrawal rate.
What is a sustainable withdrawal rate?
The sustainable withdrawal rate is the maximum percentage of your portfolio you can withdraw each year without ever depleting it, assuming a constant rate of return. It is calculated as:
In practice, the widely cited 4% rule — developed from historical US stock and bond market data — suggests that withdrawing 4% of your portfolio in year one, then adjusting for inflation annually, has historically lasted 30 years or more in the vast majority of scenarios. This calculator lets you model exactly how your specific balance, rate, and withdrawal amount interact.
Withdrawal scenarios explained
Balance grows (withdrawals < interest earned)
When your withdrawal is less than the interest generated each period, your balance increases despite the withdrawals. This is the ideal scenario for long-term wealth preservation — your portfolio sustains itself and continues to compound.
Balance holds steady (withdrawals = interest earned)
At the break-even point, every pound or dollar of interest earned is offset by your withdrawal. Your balance remains flat in nominal terms, though inflation erodes its real value over time. Use the inflation adjustment slider to model this effect.
Balance depletes (withdrawals > interest earned)
When withdrawals exceed interest, you are drawing down your principal. The calculator shows exactly when the account reaches zero — the depletion date — so you can adjust your withdrawal rate, increase deposits, or plan alternative income sources in advance.
Sequence of returns risk: this calculator assumes a constant interest rate. In reality, investment returns vary year to year — a string of poor returns early in retirement can deplete a portfolio far faster than the average return suggests. Consider modelling a conservatively low rate to stress-test your plan.
How to use this compound interest calculator
- Initial Balance — your starting pot. For retirement planning, enter your total investable assets at the point you plan to start withdrawing.
- Annual Interest Rate — your expected average annual return. Use a conservative estimate: 4–5% for a balanced portfolio, 2–3% for bonds or savings accounts, 6–8% for equity-heavy portfolios.
- Time Period — how many years you want to model. For retirement, estimate your life expectancy minus your retirement age, plus a safety margin.
- Compounding Frequency — how often interest is applied. Choose annual, quarterly, monthly, weekly, or daily. Monthly is the most common for investment accounts and savings products.
- Withdrawal Amount — the amount you plan to withdraw each period. Start with your estimated living expenses for that period, minus any other income (pension, social security, rental income).
- Withdrawal Frequency — how often you take money out: annual, quarterly, monthly, weekly, or daily. Monthly is most realistic for living expenses; use weekly or daily when income is drawn on that cadence.
- Additional Deposits — if you plan to continue contributing while also withdrawing (for example, part-time work income), enter that amount here.
- Withdrawal Inflation Rate — set this to your expected annual inflation rate (typically 2–3%) to model how your withdrawals need to increase over time to maintain purchasing power.
Common use cases
Retirement drawdown planning
The most common use of a compound interest calculator with withdrawals is retirement planning. Enter your pension pot or investment portfolio as the principal, set a realistic return rate, enter your monthly income need as the withdrawal, and extend inflation to 2–3% annually. The calculator will show whether your money lasts as long as you need it to — and if not, how much you need to reduce withdrawals or increase the starting balance.
Emergency fund management
Model how long a savings account or high-yield account will last if you draw it down during a period of unemployment or unexpected expenses, while it continues to earn interest.
Living off investments
For those pursuing financial independence, this calculator helps find the minimum portfolio size needed to sustain a target monthly withdrawal indefinitely — the point at which interest exceeds withdrawals and the balance never depletes.
Trust and inheritance planning
Model a lump sum that needs to pay a beneficiary a regular income for a defined period, while the remaining balance continues to earn interest in the interim.
Frequently asked questions
What is the 4% rule and does this calculator model it?
The 4% rule states that you can withdraw 4% of your portfolio in year one of retirement, then increase that amount with inflation each year, and statistically your portfolio will last 30 years. To model it here: enter your portfolio as the principal, set a realistic return rate (6–7% nominal), enter 4% of your principal divided by 12 as the monthly withdrawal, and set the inflation rate to 2–3%. This calculator will show you exactly how the balance evolves year by year.
How do I find the maximum sustainable withdrawal?
Increase the withdrawal slider until the "Final Balance" drops to near zero at the end of your chosen time period — or until the depletion banner appears. The withdrawal amount just below the depletion threshold is approximately your sustainable maximum for that time horizon and return rate. The "Sustainable Rate" stat in the results panel also shows you the annual withdrawal rate as a percentage of your starting balance.
Should I use nominal or real (inflation-adjusted) returns?
There are two valid approaches. Either use the nominal return rate and set the withdrawal inflation rate to your expected inflation rate — which this calculator supports directly. Or use the real return rate (nominal minus inflation) and leave the inflation slider at zero. Both give the same result for the balance in real terms. Most financial planners prefer the first approach as it shows the actual cash figures you will be dealing with.
What happens if my balance reaches zero?
The calculator detects when the balance would go negative and marks that year as the depletion point. The schedule table highlights the final year, and the result card switches to indicate depletion. This tells you precisely how many years your money lasts at the current settings, so you can adjust the withdrawal, increase the initial balance, or extend the contribution period.
Can I model both deposits and withdrawals at the same time?
Yes — the Additional Deposits field lets you add regular contributions while simultaneously making withdrawals. This is useful for someone in partial retirement who continues to earn some income, or for modelling a scenario where you are drawing down one account while still contributing to another that feeds into the same pot.
How accurate is this calculator for real-world planning?
This calculator is arithmetically exact given its inputs. The limitations are in the inputs themselves: real investment returns fluctuate year to year, inflation is variable, tax on withdrawals is not modelled, and unforeseen expenses can alter the picture. Use it as a planning tool to understand the mechanics and test different scenarios, but complement it with advice from a qualified financial planner for major decisions like retirement timing.
Is this compound interest calculator with withdrawals free?
Yes. Misprise’s compound interest calculator with withdrawals is free to use with no signup. Results include a live balance chart, depletion date, sustainable withdrawal rate, a yearly or weekly timeline, and print and share tools. Figures are estimates for education and planning — not personalised financial advice.
Related tools
Use this drawdown calculator alongside other Misprise tools when you are modelling a portfolio or a trade.