Guyton-Klinger Calculator
An inflation-adjusted base plus guardrails that cut or raise spending when the withdrawal rate drifts too far from where it started.
Part of the FIRE simulator, a historical backtest calculator that replays your plan across every rolling window of market history since 1871.
How the Guyton-Klinger strategy works
Guyton-Klinger starts from an inflation-adjusted base and then applies guardrails to the withdrawal rate: if a market drop pushes that rate more than a set band above where it started, the Capital Preservation rule cuts spending; if a rising portfolio pulls it the same distance below, the Prosperity rule raises spending. A plan already withdrawing above its starting rate skips its inflation raise. Spending holds steady most years, with occasional corrections.
What the Guyton-Klinger strategy trades off
The guardrails support a higher starting withdrawal than a rigid inflation-adjusted plan, and spending holds steady in the years the rate stays inside its band. Corrections trigger only once the rate has already drifted, so a cut can land in the middle of a bad market.
Pros and cons
Pros
- Supports a higher initial withdrawal than the 4% rule
- Stable in normal years, correcting only at the guardrails
- Well-known, decision-rule-based framework
Cons
- Guardrail cuts can arrive at the worst time
- More rules to track than a simple strategy
- Sensitive to the band and adjustment settings
Parameters you can adjust
- Guardrail band: How far the withdrawal rate may drift from its starting level before a guardrail fires. A wider band means fewer spending adjustments.
- Spending adjustment: How much spending is cut (or raised) when a guardrail fires. Larger values make the occasional correction bigger.
Backtest Guyton-Klinger against market history
Opens the simulator with Guyton-Klinger already selected, so you only set your portfolio and horizon.