Sequence of Return Risk
When bad markets hit early · Updated 2026
Why Sequence Risk Matters
Sequence of return risk is the single biggest threat to early retirees. If markets crash in the first few years of retirement, you're forced to sell assets at depressed prices — permanently impairing your portfolio's ability to recover. The same average returns in a different order can mean the difference between a thriving retirement and running out of money.
This calculator stress-tests your plan against the worst historical sequences: the Great Depression (1929), 1970s stagflation, the 2000 dot-com crash followed by 2008, and the 2008 Global Financial Crisis.
| Historical Period | Final Balance After 15 Years | Survived? |
|---|---|---|
| 1929 Great Depression | $342,000 | Yes |
| 1973-74 Oil Crisis | $628,000 | Yes |
| 2000 Dot-com + 2008 GFC | $187,000 | Yes (barely) |
| 2008 GFC only (10yr) | $1,240,000 | Yes |
Frequently Asked Questions
How is sequence of return risk calculated?
The formula is: Simulate worst-case market timing. Enter your values above and click Calculate to see your personalized result instantly. The biggest risk to early retirees isn't average returns — it's the sequence of those returns. A market crash in the first 5 years of retirement can devastate a portfolio that would otherwise…
What inputs do I need for the sequence of return risk?
You need: Balance, Withdrawal, Years, Expected Return. Default values are pre-filled — adjust them to match your personal finances for a customized result.
Is the sequence of return risk free to use?
Yes — all TorchFI calculators are completely free. No registration, no email required. Calculations run entirely in your browser for maximum privacy. We never see or store your financial data.
How does the sequence of return risk help with FIRE planning?
Simulate the impact of poor market returns early in retirement. Sequence risk is the biggest threat to a FIRE portfolio — see if your plan can survive a worst-case scenario. This calculator helps you make data-driven decisions about your financial independence journey instead of relying on guesswork.