Retiring straight into a market crash — would your money survive?
We replayed one $1.05M early-retirement plan against every major market crash of the last century. On fixed spending it survives just 2 of 7. Flexible spending lifts that to 5 — but only if you'd actually make the cuts.
A “my money lasts to 90” projection is a single smooth line — one average return, every year. The real danger to a retirement isn't the average; it's the order of returns. A crash in your first years of drawdown, while you're selling to fund your living, does damage a later crash never could. That's sequence-of-returns risk, and a Monte Carlo success rate blurs it into a percentage.
So we did something more visceral: we took one plan and replayed it against every major market crash of the last century — 1929, 1937, 1966, 1973, the dot-com bust, the GFC, 2022 — using the actual year-by-year returns as they happened, starting from the moment of retirement. The plan: retire at 52 on $1.05M ($600k super + $450k outside), spending $50,000 a year — a textbook comfortable early retirement. On the smooth projection, it lasts.
How to read this. Each dash below is one historical era. Green = the money still lasts to 90; amber = a short funding gap early on that then recovers; red = it runs out. Every era replays its real returns (1928–2025 market history, a proxy for a globally diversified portfolio) from the retirement year, on current AU rules, in today's dollars.
Fixed spending: it breaks more often than it holds
Keep spending your $50,000 through thick and thin, and this “comfortable” plan survives only 2 of the 7 downturns. Retiring into a bad decade drains the pot before it can recover.
Fixed spending
2/7Survives 2 of 7. A crash at the start, with no adjustment, is what breaks it.
Flexible spending (guardrails)
5/7Survives 5 of 7 — flexing spend down in the bad years rescues 3 more.
The catch. “Flexible” only works if you actually make the cuts — and they're deeper and longer than people picture. In the worst run (The Great Depression), holding on meant spending below plan for 36 years, bottoming at $35,000 (−30%). That's not a blip — it's most of your retirement.
How flexible would you really be?
This is the part a success rate can't show. “Survives” assumes you'll cut on cue. The less you'd actually cut in a downturn, the fewer eras you get through — your safety rests on a behaviour, not a number.
From 2/7 if you hold your spending to 6/7 if you'd cut all the way to essentials — that gap is how much of your “safe” retirement is really a bet on your own willingness to slash spending, for years, at the exact moment you feel poorest.
The takeaway
Two risks hide behind a tidy projection. Sequence risk — retiring into a crash is far more dangerous than the same crash a decade later. And adherence risk — flexible spending genuinely helps, but only to the extent you'd truly make the cuts. Neither shows up in a single “lasts to 90” line. A stress test against real history does.
General information only — not financial advice. Figures are estimates in today's dollars based on the stated assumptions and current FY rules; historical returns are used as a proxy and are not a prediction. Past performance is not a guarantee of future outcomes.