~$900K
Target nest egg
The portfolio size that supports $3,000/mo in retirement income using the standard 4% safe withdrawal rule.
VOO Retirement Income Calculator
Dividends only (never sell shares)
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Portfolio needed: —
Live purely off dividends; never sell shares. Portfolio preserved for heirs or future growth.
Total withdrawal (4% rule)
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Portfolio needed: —
Withdraw 4% annually (standard retirement rule). Portfolio lasts approximately 30 years.
This calculator is for illustrative purposes only. Results are based on hypothetical assumptions including a fixed annual return derived from historical averages. Actual investment returns will vary, possibly significantly, due to market conditions, fees, taxes, inflation, and other factors not modeled here. This is not a prediction, guarantee, or recommendation. Consult a licensed financial advisor for personalized projections.
4% rule footnote: The 4% rule assumes your portfolio continues growing at its historical rate even during withdrawals. Dividend income will gradually shift toward capital withdrawals over time. This is an estimate. Consult a financial advisor for personalised retirement planning.
Common scenarios
How much you need to invest monthly in VOO to reach each income target using both strategies. All scenarios assume an 8% annual return, starting at age 35 with retirement at 65 and no initial investment.
| Target income | Dividends only | 4% rule |
|---|---|---|
| $1,000/mo | $671/mo | $201/mo |
| $2,000/mo | $1,342/mo | $403/mo |
| $3,000/mo | $2,013/mo | $604/mo |
| $5,000/mo | $3,355/mo | $1,006/mo |
| $10,000/mo | $6,710/mo | $2,013/mo |
Dividends only requires a portfolio of annual income ÷ 0.012 (VOO's ~1.2% dividend yield). 4% rule requires annual income ÷ 0.04. The dividends-only approach costs ~3.3× more per month but preserves your entire portfolio indefinitely.
The idea in one line
Most calculators go forward: "If I invest X, what do I get?" This one runs the math in reverse.
Two ways to reach your number
- Portfolio needed: Target income ÷ 0.012 (VOO's ~1.2% yield)
- Depletes? No
- Cost: Roughly 3.3× more per month than the 4% rule
- Portfolio needed: Target income × 25
- Depletes? Gradually, over ~30 years
- Cost: Much lower monthly contribution
Default assumptions
Keep going
Frequently asked questions
How much do I need to invest in VOO per month to retire?
It depends on your strategy and timeline. A 35-year-old targeting $3,000 per month at age 65 with an 8% return needs about $604/month using the 4% withdrawal rule, or about $2,013/month using a dividends-only approach. The 4% rule requires a smaller portfolio ($900,000) but gradually depletes it, while dividends-only requires a larger portfolio ($3,000,000) but preserves it indefinitely.
What is the difference between dividends only and total withdrawal?
Dividends only means your retirement income comes entirely from VOO's dividend payments. You never sell shares, preserving your portfolio for heirs or future growth. This requires a much larger portfolio because VOO's dividend yield is approximately 1.2%. Total withdrawal uses the 4% rule, combining dividends with periodic share sales, requiring a smaller portfolio but gradually depleting it over approximately 30 years. For $3,000/month, dividends-only needs a $3M portfolio versus $900K with the 4% rule.
What annual return should I assume for VOO?
VOO has returned approximately 10-11% annually since inception in 2010, tracking the S&P 500. A common conservative estimate for future planning is 7-8%, which accounts for the possibility of lower future returns compared to the recent past. This calculator defaults to 8%, but you can adjust it to model optimistic (10%) or pessimistic (6%) scenarios. The S&P 500's long-term historical average since 1926 is roughly 10% nominal.
What is the 4% rule used in this calculator?
The 4% rule is a widely cited retirement guideline from the 1994 Trinity Study. It suggests you can withdraw 4% of your portfolio in the first year of retirement, then adjust for inflation annually, with a low risk of running out of money over a 30-year retirement. This means you need a portfolio worth 25 times your desired annual income. For $3,000 per month ($36,000 per year), you would need $900,000. The rule assumes your portfolio continues growing during withdrawals, with dividend income gradually shifting toward capital withdrawals over time.