Articles

Six ways to look at drawing your savings

9 October 2026 · 6 min read

Saving for retirement gets most of the attention. Spending in retirement is the harder question: how much can be taken from savings each year so that they last as long as the people who own them, through good markets and bad? Nobody knows the answer in advance, because it depends on how long people live and on what markets and prices do. What researchers have done is work out rules, each a mechanical way of deciding how much to draw, and test them against the past or against many possible futures.

FinWise365’s Retirement screen shows six ways of looking at this, each worked out on a household’s own numbers. They show what each rule does on the household’s figures; they do not say which to choose. Here they are, with the screen’s own words for each rule and for what it leaves out.

1. Spend what the plan needs

This is not a rule from research but the plan itself: “Each month the plan spends what its items say, and pays for it from cash and then from savings.” It is the starting point the other ways are compared with. Spending stays what the household entered, and the question is simply how long savings last.

2. A fixed rate raised with prices

“When work stops, take a set share of your liquid savings in the first year, then the same amount raised with prices each year. Living costs after work stops are replaced by that amount.” It starts from liquid savings only: property, CPF and EPF are not counted.

This is the family of rules widely known as “the 4% rule”. Its origin is a paper by William Bengen in the Journal of Financial Planning in October 1994, “Determining Withdrawal Rates Using Historical Data”, which tested starting rates against the historical returns of American shares and bonds and asked which rate would have lasted thirty years even through the worst periods of the past. About 4% did. Morningstar’s yearly study, “The State of Retirement Income”, asks a similar question looking forward, with many possible futures; its estimate moves from year to year with valuations and yields. For India, a 2024 study by Raju and Saraogi found a lower rate, about 3%, on Indian data.

A systematic withdrawal plan, or SWP, is a set amount taken out of a fund each month. The fixed rate is like one applied to all liquid savings together. FinWise365 also lets a single fund carry a regular withdrawal of its own: a monthly amount in today’s money, from an age or a month, either raised with prices or kept level. What the plan then shows is the outcome of those assumptions, and nothing here says which way to choose.

3. How long savings last at each rate

One rate on its own says little. The screen therefore runs the plan at each rate from 2.5% to 6%, in half-point steps, and shows a table: at each rate, the first year’s withdrawal in today’s money, and whether savings last to the end of the plan or the age at which they run out. A rate can be picked from the table to see it in full.

The table makes the trade-off visible. A higher rate means more to spend each year and savings that run out sooner; a lower rate, less to spend and savings that last longer, perhaps with a large sum left at the end. Where that balance sits is a household’s own choice, and it may depend on what else it has, such as a lifelong payout or a home it could sell.

4. A target multiple of yearly spending

“Savings of a set number of times your yearly living costs: 25 times is the 4% rate, 33 times is 3%.” The multiple is the rate turned upside down: one divided by 4% is 25. It is a view, not a way of drawing savings: the screen gives the amount in today’s money and the year and age the plan reaches it, or says it is not reached; once a way is used in the plan, the chart shows it as a dashed line. It follows the rate of the way the household uses, or 4% when it uses none.

5. Floor first

“After work stops, income that arrives whatever markets do (other income, rent from your property, annuities) is set against essential spending. Savings fill the gap, at the fixed-rate amount.” Living costs count as essential; other spending and goals do not.

The idea behind it is common in retirement research: cover the spending that cannot wait with income that does not depend on markets, and let savings carry the rest. A household with a large annuity or rent needs less from its savings for the essentials, and the floor-first view shows by how much. CPF and EPF payouts are not modelled today, so they are not in the income shown here.

6. The earliest age to stop work, as a range

“The earliest age at which savings still last to the end of the plan, on your assumptions and when each of these goes wrong.” The screen works it out four times:

• On your own assumptions.
• Investments grow 2 points a year less.
• Living costs 10% higher.
• Investments fall 30% in the year work stops.

The answer is a range, such as “between 57 and 61”, with each test named beside its own age. A single age would look more exact than any plan can be; a range shows how much the answer moves when one assumption goes wrong. The last test matters because a fall just as withdrawals begin does more harm than the same fall years later, when less is left to lose.

Using them in a plan

On the Retirement screen, the fixed rate or floor first can be made the plan’s own with “Use this in my plan”, and undone with “Back to spending what the plan needs”. Plan’s sentence, its chart, What if and the PDF of the plan then follow that choice. None of these ways is better than another in general; each answers a different question, and seeing them side by side on a household’s own figures is the point. The how-long-savings-last calculator gives a quick first look without an account.

Illustration, not advice. Written 9 October 2026; checked 9 October 2026.

Sources

1. It Was 20 Years Ago Today (on Bengen, “Determining Withdrawal Rates Using Historical Data”, October 1994), Journal of Financial Planning, Financial Planning Association, read 9 October 2026.
2. Safe withdrawal rate in retirement increases with more flexible approach (on “The State of Retirement Income”), Morningstar Australia, 7 January 2026, read 9 October 2026.