It's clear from the table that the range varies dramatically.

With high annual withdrawal rates, our money is expected to last only six or seven years, but for lower withdrawal rates our money is expected to last for over 40 years ? well past the expected lifespan for a person retiring at age 65.

Also, the higher the equity allocation, the longer our money is expected to last.

This is not as pronounced at very high withdrawal rates, as the compounding effects of the higher returns that equities offer do not have time to benefit investors.

However, we need to know more: we must also consider the likelihood of not running out of money during our lives.

As females tend to live longer than males, we calculate these probabilities for both sexes.

The following tables give probabilities of not running out of money for males and females, who retire at age 65.

Probability of success (%) in males

Withdrawal Rate 0% Equity 25% Equity 50% Equity 75% Equity 100% Equity
2.5% 99 99 99 99 99
4% 86 93 96 95 94
6% 60 68 76 80 82
8% 43 47 54 61 65
10% 32 35 39 45 50
12% 26 28 30 34 39
17.5% 17 17 18 20 22

From both these tables, we note that the range of probabilities of success (i.e. not running out of money during our lifetime) is very broad, from eight percent to 99 percent. The chance of success is higher for males than females; is higher as the withdrawal rate decreases; and lastly, is higher if the equity allocation is increased.

Probability of success (%) in females

Withdrawal Rate 0% Equity 25% Equity 50% Equity 75% Equity 100% Equity
2.5% 97 99 99 99 98
4% 75 86 91 92 91
6% 42 51 62 69 73
8% 26 30 37 45 52
10% 18 20 24 29 36
12% 14 15 17 20 25
17.5% 8 9 10 10 12

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