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Corpus Depletion Risk

Background

Corpus depletion risk is the possibility that your retirement savings run out while you are still alive, forcing uncomfortable lifestyle cuts or dependence on others.

Explanation

Aggressive withdrawals, low or volatile returns and high inflation all increase depletion risk. Testing your plan under conservative assumptions and stress scenarios (like low-return decades) helps you judge whether your current approach is robust.

Example

A portfolio heavy in fixed deposits with a 5% withdrawal rate might exhaust itself in 20–25 years, especially with high inflation. Reducing withdrawals and adding growth assets like equity can improve sustainability.

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