{"url":"https://etfiq.com/academy/building-wealth/retirement-drawdown/","section":"academy","title":"Retirement withdrawals: a 4% draw in a bad year | ETFIQ","description":"Walk a 4% yearly withdrawal through a real bad year, 2022, on a 60% stock benchmark, and see why the draw grows as the balance falls. Real dated data.","as_of":"Nov 10, 2026","structured_data":[{"@type":"LearningResource","@id":"https://etfiq.com/academy/building-wealth/retirement-drawdown/#lesson","name":"Retirement withdrawals: a 4% draw in a bad year","description":"Drawing $20,000 a year from $500,000 in a 60% stock mix left $404,018 after 2022's 15.83% fall and $518,485 by Dec 31, 2025, hypothetically.","url":"https://etfiq.com/academy/building-wealth/retirement-drawdown/","learningResourceType":"Lesson","teaches":"Why a fall early in retirement hurts most when the yearly draw is large: the same dollars become a bigger share of a smaller balance","educationalLevel":"Intermediate","timeRequired":"PT7M","inLanguage":"en","isAccessibleForFree":true,"isPartOf":{"@type":"Course","@id":"https://etfiq.com/academy/building-wealth/#course","name":"Building Wealth","url":"https://etfiq.com/academy/building-wealth/"},"position":6,"dateModified":"2026-11-10","author":{"@type":"Organization","name":"ETFIQ Research","url":"https://etfiq.com"},"publisher":{"@type":"Organization","name":"ETFIQ Research","url":"https://etfiq.com"}},{"@type":"FAQPage","@id":"https://etfiq.com/academy/building-wealth/retirement-drawdown/#check","mainEntity":[{"@type":"Question","name":"After a fall, what happens to a fixed-dollar yearly draw?","acceptedAnswer":{"@type":"Answer","text":"It grows as a share of the balance. the same dollars come out of a smaller pile."}},{"@type":"Question","name":"Pat has $300,000 and takes $12,000 at the start of the year. The rest falls 20%. What share of the new balance is next year's $12,000?","acceptedAnswer":{"@type":"Answer","text":"About 5.2%. ($300,000 \u2212 $12,000) \u00d7 0.8 = $230,400, and $12,000 \u00f7 $230,400 is about 5.2%."}},{"@type":"Question","name":"In 2022, ETFIQ's 20% stock benchmark fell 13.92%. What does that show?","acceptedAnswer":{"@type":"Answer","text":"A lower stock share doesn't rule out a large loss in one year. bonds fell with stocks that year, so even a bond-heavy mix lost."}}]},{"@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"ETFIQ","item":"https://etfiq.com/"},{"@type":"ListItem","position":2,"name":"Academy","item":"https://etfiq.com/academy/"},{"@type":"ListItem","position":3,"name":"Building Wealth","item":"https://etfiq.com/academy/building-wealth/"},{"@type":"ListItem","position":4,"name":"Retirement withdrawals","item":"https://etfiq.com/academy/building-wealth/retirement-drawdown/"}]},{"@type":"WebPage","name":"Retirement withdrawals: a 4% draw in a bad year","description":"Walk a 4% yearly withdrawal through a real bad year, 2022, on a 60% stock benchmark, and see why the draw grows as the balance falls. Real dated data.","url":"https://etfiq.com/academy/building-wealth/retirement-drawdown/","dateModified":"2026-11-10","isPartOf":{"@type":"WebSite","name":"ETFIQ","url":"https://etfiq.com"},"speakable":{"@type":"SpeakableSpecification","cssSelector":[".lede"]},"publisher":{"@id":"https://etfiq.com/#org"}}],"characters":5592,"truncated":false,"content":"ETFIQ / Academy / Building Wealth / Retirement withdrawals \n \n Retirement withdrawals: a 4% draw in a bad year\n Data as of Nov 10, 2026. Rebuilt every trading night.\n Drawing $20,000 a year from $500,000 in a 60% stock mix left $404,018 after 2022's 15.83% fall and $518,485 by Dec 31, 2025, hypothetically.\n Building Wealth \u00b7 Lesson 6 of 6 1 2 3 4 5 6 \n Set a balance. See what each calendar year did to it, before any draw. Starting balance $500,000 On $500,000: 2022 \u2212$79,148, 2023 $76,621, 2024 $51,293, 2025 $80,942. Hypothetical balance. ETFIQ Strategic 60% stocks, calendar-year returns; before 2026-10 the rule is applied to past prices. \n The question\n \"When I retire, how much can I take out each year? And what happens if the market drops right after?\"\n The idea\n In retirement, money flows the other way: you draw from your savings each year instead of adding to them. A common starting point is the 4% rule of thumb : take 4% of your savings in the first year. (The usual version raises that dollar amount each year to keep up with rising prices. Here we keep it flat.)\n The risk is a fall early on. When the balance drops, the same dollar draw becomes a bigger share of what's left , and the dollars you take out are no longer there to recover.\n Worked example\n We'll use ETFIQ Strategic, 60% stocks , one of ETFIQ's benchmarks: a fixed mix of low-cost index ETFs, about 60% stocks, reset to that mix each month.\n ETFIQ began tracking it on Oct 5, 2026 ; earlier years apply its rule to past prices, so they are hypothetical . All returns below are its calendar years, from one table, with prices to Nov 10, 2026 .\n Start with $500,000 on the first day of 2022. The draw is 4%: $20,000 , set aside at the start of each year to live on.\n Step 1. 2022, a bad year: the mix fell 15.83% .\n Take $20,000: $500,000 \u2212 $20,000 = $480,000\n Fall: $480,000 \u00d7 (1 \u2212 0.1583 ) = $404,018 \n Dollar results use each year's unrounded return, so multiplying the rounded returns shown can differ by a few dollars.\n Step 2. Look at the next draw. $20,000 was 4% of $500,000. Now it is $20,000 \u00f7 $404,018 = 4.95% of what's left. Same dollars, bigger bite.\n Step 3. The next three years were good: +15.32% , +10.26% , +16.19% .\n Year Start, after the $20,000 draw Return End \n 2022 $480,000 \u221215.83% $404,018 \n 2023 $384,018 +15.32% $442,865 \n 2024 $422,865 +10.26% $466,245 \n 2025 $446,245 +16.19% $518,485 \n After four years and $80,000 taken out, the balance was back above $500,000.\n Step 4. Now double the draw to 8%, $40,000 a year, over the same four years. The balance ends 2022 at $387,184 and 2025 at $415,208 : still $84,792 short of where it began, even after three strong years.\n A bad year early hurts most when the draw is large. The 4% draw had room to recover. The 8% draw kept selling into the hole.\n The 4% here is an example for learning, not a plan.\n The common mistake\n \"A mix with fewer stocks can't have a bad year.\" In 2022, bonds fell along with stocks. ETFIQ's 20% stock benchmark lost 13.92% , not far from the 60% mix's 15.83% , while the all-stock US benchmark lost 19.49% . Fewer stocks usually means smaller swings, not no swings. Check a mix's worst year before relying on it.\n Check your understanding\n Pick an answer to see why. Two of three right passes the lesson.\n 1. After a fall, what happens to a fixed-dollar yearly draw? A It shrinks as a share of the balance B It stops C It stays 4% of the balance D It grows as a share of the balance Answer: D. It grows as a share of the balance. the same dollars come out of a smaller pile. Not C: 4% was set on the starting balance, not on whatever is left. 2. Pat has $300,000 and takes $12,000 at the start of the year. The rest falls 20%. What share of the new balance is next year's $12,000? A 4.0% B About 5.2% C 20% D About 3.2% Answer: B. About 5.2%. ($300,000 \u2212 $12,000) \u00d7 0.8 = $230,400, and $12,000 \u00f7 $230,400 is about 5.2%. Not A: that was the share before the fall. 3. In 2022, ETFIQ's 20% stock benchmark fell 13.92% . What does that show? A A lower stock share doesn't rule out a large loss in one year B Bonds always rise when stocks fall C The 20% mix is riskier than the 60% mix D 2022 data is wrong Answer: A. A lower stock share doesn't rule out a large loss in one year. bonds fell with stocks that year, so even a bond-heavy mix lost. Not C: over 2022 the 60% mix still fell further. \n Takeaways\n A fixed draw becomes a bigger share of the balance after a fall. \n The larger the draw, the harder it is to recover from an early bad year. \n Look up a mix's worst calendar year on ETFIQ before planning withdrawals from it. \n Do it on ETFIQ\n Build your own mix and see its worst year \n Where to next\n Previous lesson: Bonds for income: duration and the rate cushion Building Wealth: all lessons ETFIQ Academy How ETFIQ computes these numbers \n Cite this page. ETFIQ, Retirement withdrawals: a 4% draw in a bad year, data as of Nov 10, 2026. https://etfiq.com/academy/building-wealth/retirement-drawdown/ Free to use with attribution for data ETFIQ computes; issuer data stays under its owner's terms. The underlying files are at Open data .\n Other forms Plain ETFIQ, Retirement withdrawals: a 4% draw in a bad year, data as of Nov 10, 2026. https://etfiq.com/academy/building-wealth/retirement-drawdown/ APA ETFIQ. (Nov 10, 2026). Retirement withdrawals: a 4% draw in a bad year. Retrieved from https://etfiq.com/academy/building-wealth/retirement-drawdown/ Markdown [Retirement withdrawals: a 4% draw in a bad year (ETFIQ, Nov 10, 2026)](https://etfiq.com/academy/building-wealth/retirement-drawdown/)","source":"ETFIQ, independent ETF data. Recomputed nightly from public filings and prices.","publisher":{"@id":"https://etfiq.com/#org","name":"ETFIQ","url":"https://etfiq.com"},"license":"https://etfiq.com/license/","license_text":"Data ETFIQ computes is free to use with attribution: ETFIQ (etfiq.com). Issuer data stays under its owner's terms.","citation":"ETFIQ, Retirement withdrawals: a 4% draw in a bad year, data as of Nov 10, 2026. https://etfiq.com/academy/building-wealth/retirement-drawdown/"}