Does the 4% rule work in the Netherlands?

How much you can take out each year

The 4% rule says you can take out 4% of your savings in your first year retired, then the same amount each year, raised with inflation, for 30 years. In the Netherlands it needs a lower rate if the money must last longer, and Box 3 on top: in 2026, €9,517 a year on one person's €500,000 in investments.

Your withdrawal rate is how much of your savings you take out each year without running out before you're 90. It depends mostly on how long the money has to last. The longer it has to last, the more bad years in the markets it has to get through, so the lower the rate:

You take out that share in your first year retired. After that, you take out the same amount each year, raised with inflation. With €500,000 and money that has to last 40 years, that's €17,500 in the first year.

These rates assume most of your money is in shares, spread over the world. And they don't include Box 3 (tax on savings and investments), which in the Netherlands comes on top.

Your AOW and pension shorten how long it has to last

In the Netherlands, your AOW (state pension) and your pension through work (pillar 2) pay for life. Once they start, your savings only pay what they don't cover. That's why the rate rarely has to last from the day you stop until you're 90.

The years before your pensions start are the Pension Bridge. Plan for them on their own: a fixed number of years, paid for from savings as they go. The withdrawal rate only has to last from the year your last pension starts until you're 90.

Take a made-up couple of 36 and 34, who earn €73,000 and €61,000 a year before tax. They'd like to spend €48,000 a year once retired, after tax and in today's euros, not counting the mortgage: that's their budget.

Stopping earlier makes the bridge longer and costs more. The rate after it stays the same, as long as your last pension starts at the same age.

What Box 3 takes on top

Box 3 doesn't tax what your investments earned. In 2026 it assumes they returned 6% and taxes that at 36%, on everything above the tax-free €59,357 a person. That's up to 2.16% of your investments a year, in good years and bad. See Box 3 in 2026 for how the tax is worked out.

The tax hurts most in the years your investments fall. You pay it on what you own, not on what you earned, so in a bad year it comes out of savings that are already shrinking. For the example couple, Box 3 takes €16,945 from their savings in 2042, their first year retired.

So a rate from the table is a starting point. The rates allow for bad years in the markets, but not for Box 3, so the tax has to come out of your savings every year on top. If you want more room for both, plan with a lower rate.

Why other Dutch sites say 2% or 3.5%

Two Dutch sites give a single rate for everyone.

• Invest4FIRE says 2% to 2.5%. It takes Box 3 out of the rate itself: about 2% for the tax, from 4%. Its 2% "fully accounts for Box 3 and inflation", for people who stop at 45 to 50 and live off their investments alone.
• Financieel Onafhankelijk Blog (Mr FOB) says 3.5%, from 2016. It points to a lower safe rate in Dutch market history than in the US, and to spreading your money over the world. Box 3 is then paid out of the 3.5% you take out, so what you can spend is less.

Both can be right for someone. They differ on whether the tax is in the rate or on top of it, and on how long the money has to last. Setting the rate by how long the money has to last, and paying Box 3 on top, works for any age you stop.

Where the rates come from

Most research on withdrawal rates tested the US stock and bond markets, which is where the name "4% rule" comes from. In 1994 William Bengen found that 4% a year lasted 30 years even for the worst time to retire since 1926. The Trinity Study confirmed it in 1998. Early Retirement Now later tested 40 to 60 years: for 60 years, it found about 3.5%, and less when shares started out expensive.

That research had no wealth tax in it, and US markets did better than most. A study of Dutch markets, which Mr FOB cites, found a safe rate of about 3.3%. That's why 4% is only for money that has to last up to 30 years, with Box 3 on top.

What the Box 3 reform could change

The government wants Box 3 to tax your actual return from 1 January 2028, not an assumed one. In a year your investments fell, you'd pay little or no tax. That would take much of the pressure off in the bad years that decide a safe rate. The Senate hasn't voted on it yet, so it isn't certain: see what changes from 2028. Until then, plan with the 2026 rules.