Would your retirement survive 2008?
Stress-test your portfolio against the three worst retirement starts in modern history — dot-com 2000, financial crisis 2007, 1970s stagflation. Then see what adding a guaranteed income floor does to the failure rate.
Your retirement
Three sliders. Approximate is fine.
Total annual spending. Annuity covers $12,000; portfolio only pulls $18,000/yr.
$12,000/yr guaranteed — portfolio only needs to cover $18,000/yr of the spend.
Premium estimated at a ~6.75% blended lifetime payout rate. Single-life SPIAs at 65 run higher (~7.8%), joint-life slightly lower (~7%).
Portfolio depleted in 3 of the 3 worst historical retirement starts.
$322,222 in market + $1,000/mo for life — even if the portfolio dies, the annuity keeps paying.
Portfolio balance over 30 years
Solid = with annuity floor. Dashed = without. Same market, different outcome.
-49% cumulative decline (2000–2002)
-37% in a single year (2008)
-40% cumulative decline (1973–1974)
Even after carving $177,778 out of your $500,000 to buy $1,000/mo of guaranteed income, the remaining $322,222 still couldn't survive every period at this withdrawal rate. That's a sign the underlying spending plan needs a closer look — either lower the draw, work longer, or carve more out for the guaranteed floor.
One thing that didn't fail: the annuity income itself. Even in the scenarios where the portfolio depleted, the $1,000/mo check kept coming. So you'd never be at $0 income — you'd just be living entirely on the annuity once the market portion was gone.
One important caveat: this uses real S&P 500 total returns and a simplified 4% bond return. Real bond returns varied by period (sometimes more, sometimes less), and the tool doesn't model taxes, fees, or the timing of Social Security. Use this to understand the SHAPE of the risk — for the exact numbers, a specialist would model your full situation.
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Educational tool. Uses actual S&P 500 total return data; bond returns simplified to a 4% annual constant. Does not model taxes, fees, Social Security timing, or carrier-specific annuity payouts. Past performance is not indicative of future results. AM Best ratings are an opinion of relative financial strength, not a guarantee.
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Frequently asked questions
What is sequence of returns risk?
It's the risk that a string of bad market years early in retirement permanently damages a portfolio because you're withdrawing money at the same time it's losing value. Two retirees with identical average returns over 30 years can end up with wildly different outcomes — one with millions, the other broke — based purely on the order their returns arrived in. The first 5-10 years matter most.
Why these three historical periods?
They're the three most punishing retirement starts in modern history: 2000 dot-com (three straight down years right out of the gate), 2007 financial crisis (S&P 500 down 37% in one year), and 1973 stagflation (40% cumulative drop over two years plus runaway inflation). If a plan survives these three, it generally survives anything.
How does adding a guaranteed income floor change the outcome?
Every dollar that comes from the annuity is a dollar you don't have to pull from the portfolio during a crash. The portfolio gets time to recover instead of being force-sold at the bottom. In most historical stress tests, adding $1,500-$2,000/mo of guaranteed income rescues every failing scenario for a $500k portfolio drawing at a 6% rate.
What does the tool simplify?
Taxes (zero), fees (zero), bond returns (a constant 4%), Social Security timing (not modeled), and the specific carrier you'd buy the annuity from. The point is to show you the SHAPE of sequence risk and how a floor affects it. The precise numbers come from a full retirement plan with your actual situation.
Should I just buy a big annuity then?
Not necessarily. Lifetime annuities are long-term contracts — once you turn the income on, that piece is irrevocable. The right amount is the slice that takes the sleep-at-night problem off the table while leaving enough invested for growth, legacy, and flexibility. For most retirees that's somewhere between 25% and 50% of the portfolio, not all of it.