1/N Calculator
The current portfolio divided evenly across the years left in the plan, which runs the balance down to roughly zero at the end.
Part of the FIRE simulator, a historical backtest calculator that replays your plan across every rolling window of market history since 1871.
How the 1/N strategy works
Each year the withdrawal is the portfolio balance divided by the number of years remaining, so the share taken starts small and grows as the horizon shortens: 1/30 of the balance with 30 years left, 1/2 with two years left. It is a self-liquidating annuity with no insurer and no assumed return behind it. The final year’s withdrawal takes whatever is left.
What the 1/N strategy trades off
1/N spends a balance down to roughly zero by a fixed end date, which is what bridging to a pension or a Social Security start needs and why it leaves nothing for a bequest. Withdrawals grow sharply as the horizon closes, and the final years are the most volatile.
Pros and cons
Pros
- Naturally spends the portfolio down over a fixed horizon
- Requires no return assumptions
- Front-loads less than a fixed percentage early on
Cons
- Spending grows sharply and becomes volatile near the end
- Not designed to preserve capital or leave a legacy
- Assumes a hard end date
Parameters you can adjust
This strategy has no adjustable parameters. It runs from your portfolio, allocation, and starting withdrawal alone.
Backtest 1/N against market history
Opens the simulator with 1/N already selected, so you only set your portfolio and horizon.