Fund Drawdown Simulation

This Demonstration allows the user to estimate the value of a pool of money (the fund) that increases in value due to an investment return on the funds (at rates between 0 and 10% per year) and decreases in value due to an annual withdrawal. An example of the usage of this Demonstration would be to estimate how the value of a college fund changes over the four years that tuition and living expenses are withdrawn, while the balance of the fund continues to earn interest. Similarly, the value of a retirement nest egg can be estimated under a situation where the retiree makes annual withdrawals. The last column of the table and the blue-lined plot show how inflation and withdrawal rates affect purchasing power relative to the initial year's value.