Withdrawal strategies

Saving up is one half of FIRE. The other is living on the money: which account to take it from, whether to sell fund units or live on dividends, and what to do when the stock market falls for years. Here is how it works in Sweden, with ISK, taxes and the pension.

Work out your own path What is FIRE?

In short

Keep the money on an ISK: you pay a small tax on the value each year, but nothing when you sell or get dividends.
Count the ISK tax in what you need, about 1 % of the money a year.
On an ISK, selling fund units and getting dividends cost the same in tax. Broad index funds spread the risk more.
Keep one to three years of spending in a savings account, so you never have to sell when the market is down.
Take out a little less than 4 %, and spend less in bad years.
Plan for two phases: your own money until the pension starts, and less of it after that.

ISK, capital insurance or a regular account

Where the money is decides how it is taxed, and so how much you can take out. Most people in Sweden who aim for FIRE save on an investment savings account (ISK).

Investment savings account (ISK)

The simplest choice for most people. You own the holdings and can take money out whenever you like.

Tax: A flat tax on the value: 1.065 % a year in 2026 on what is above 300 000 kr (per person, ISK and capital insurance together).
Sales and dividends: No tax when you sell, get dividends or take money out.
Losses: Not deductible.
Good to know: The tax is paid through your tax return, not taken from the account. Without a salary it comes as back tax (kvarskatt).

Capital insurance (KF)

Taxed like an ISK, but the insurer owns the holdings and you own the insurance.

Tax: The same yield tax as on an ISK, which the insurer takes straight from the account.
Sales and dividends: No tax when you sell, get dividends or take money out.
Losses: Not deductible.
Good to know: You can name a beneficiary, for example your partner, who then gets the money directly if you die. Useful for unmarried couples, who do not inherit each other without a will.

Regular account (depå)

No tax on the value, but tax on what you earn.

Tax: 30 % of the gain when you sell, and of dividends. Funds also cost 0.12 % of their value a year (30 % tax on a schablon income of 0.4 %).
Sales and dividends: You decide when gains are taxed: only what you sell is taxed.
Losses: Deductible, in full against gains on listed shares and funds.
Good to know: Moving the holdings to an ISK counts as selling them, and the gain is taxed then.

Which costs less depends on the return. An ISK gives lower tax when the return is above 3.55 % a year, the government borrowing rate plus one percentage point. Shares have returned more than that over long periods, which is why an ISK suits long-term saving.

Count the tax in

The 4 % rule is counted without tax. On an ISK about 1 % of the money goes to tax every year, however the market does. Either aim a little higher, or count with a return one percentage point lower in the FIRE calculator.

You spend a month	Saved, 30 times a year	ISK tax a year
15 000 kr	5 400 000 kr	54 315 kr4 526 kr per month
25 000 kr	9 000 000 kr	92 655 kr7 721 kr per month
35 000 kr	12 600 000 kr	130 995 kr10 916 kr per month

One person, 1.065 % on the value above 300 000 kr, 2026. The tax is counted on the value at the start of each quarter and on the year's deposits, so these are round figures. A couple has two tax-free amounts: spreading the savings saves 3 195 kr a year.

Sell fund units or live on dividends?

Living on dividends is popular in Sweden: the companies pay out money every spring, and you never have to sell anything. The other way is to own broad index funds and sell a little at a time. Both can work. They differ in risk, cost and how they feel.

Sell fund units

Own a few broad, cheap index funds and sell as much as you need, for example once a year.

Thousands of companies in many countries: one company or sector going badly matters little.
Cheap: a broad index fund often costs well under 0.5 % a year, and selling fund units usually costs nothing.
You take out exactly what you need, when you need it.
Little work: no companies to choose or follow.

You have to sell, also when the market is down. A buffer solves most of it.
It can feel hard to watch the money shrink, even when the plan holds.

Live on dividends

Own companies that pay out a large share of their profit, and live on what comes in.

The money comes by itself, without deciding when to sell.
Dividends usually swing less than share prices.
Many find it calming never to touch the capital.

Fewer companies, often in the same sectors such as banks, property and industry: more risk.
Dividends are cut just when times are bad. In 2020 many Swedish companies cancelled or postponed theirs, and Finansinspektionen asked the banks to wait.
The companies decide how much you get, not what you need.
On a regular account every dividend is taxed at 30 %, even the ones you do not need.
Foreign dividends often carry a withholding tax that you do not always get back.

A dividend is not free money

A share costs 100 kr and the company pays a dividend of 4 kr. The day after, the share costs about 96 kr. You still have 100 kr, now as 96 kr in shares and 4 kr in cash, just as if you had sold shares for 4 kr. What counts is the total return: the dividend and the price together.

On an ISK it is a matter of taste

On an ISK a dividend and a sale cost the same in tax, so the choice is about risk and how it feels. On a regular account selling usually costs less: only the gain in what you sell is taxed, and the rest of the gain only when you sell it.

A middle way: a broad index fund as the base, and dividend shares for those who enjoy picking companies. The dividends then cover part of the year, and you sell fund units for the rest.

A buffer for bad years

The biggest risk when you live on your savings is a big fall in the first years. If you have to sell when prices are low, each krona costs more fund units, and they are gone when the market recovers. It is called sequence risk.

The Stockholm stock market's big falls (OMXS30)

Fall	Down	Back at the top after
The IT crashMarch 2000 to October 2002	73 %	15 yearsJanuary 2015
The financial crisisJuly 2007 to November 2008	57 %	6 yearsNovember 2013
The pandemicFebruary 2020 to March 2020	32 %	9 monthsNovember 2020
Inflation and rising ratesJanuary 2022 to September 2022	27 %	2 yearsMarch 2024

Counted on the index's daily closes, from the top to the first day it was back. The index leaves out dividends: with them, the way back was shorter.

Some falls are over in months, others take many years. A buffer lets you wait instead of selling at the bottom.

Three buckets

Savings account: the next year or two
One to two years of spending in a savings account with the deposit guarantee, which covers 1 150 000 kr per person and bank. You pay yourself a salary from here.
Interest funds: the years after
If you like, another year or two in short interest funds, which give a little more than the account and swing little.
Equity funds: the rest
Everything else in broad index funds. This is the money that has years to grow, and it fills up the buckets above.

The rule is simple: in a good year you sell equity funds and fill up the buffer. In a bad year you leave the funds alone and live on the buffer, and fill it up again when the market has recovered.

The buffer is often best outside the ISK: on a savings account only the interest is taxed, at 30 %, while money on an ISK pays the flat tax on the whole amount, whatever it earns. That holds as long as the interest is below 3.55 %.

The buffer has a price: money in a savings account grows about as fast as prices, so a large buffer lowers the long-term return. Counted in kronor it is not always better than holding a little in interest funds. Its great value is that it makes it easier to stick to the plan when the market falls. Many settle for one to three years of spending.

How much can you take out?

The 4 % rule comes from American stock market history, which has been unusually good, and is built for 30 years without tax. An early retirement can last 40 to 50 years, and on an ISK about 1 % a year goes to tax. That is why many in Sweden plan with 3 to 3.5 %, about 30 times a year's spending.

How you take the money out matters as much as how much. Four common ways:

A fixed amount

Take out a set share of the money the first year, for example 3.5 %, and the same amount in kronor after that, raised with inflation.

Steady and easy to plan for.

Takes no notice of the market: after a crash you sell too much.

A share of the value

Take out the same share of what the money is worth every year, for example 4 %.

The money never runs out.

What you get swings with the market, and can fall a lot in a bad year.

Guardrails

Start with a fixed amount, but adjust it when the share drifts too far: cut it by a tenth if it climbs above, say, 5 % of the money, and raise it by a tenth if it falls below 3 %.

Lets you start a little higher, since you promise to cut back in bad years.

Needs a check every year, and the discipline to follow it.

Flexible, with some work

Earn a little in bad years, part time or on a project, and take out less. Even a small income in the first years makes a big difference.

One of the best protections against a bad start.

Depends on there being work to get.

A simple rule that helps a lot: do not raise the amount with inflation the year after the market has fallen.

Until the pension, and after

An early retirement has two phases. Until the pension starts, your own money pays for everything. After that it only has to cover what the pension does not.

The public pension

In 2026 it can be drawn from age 64, and the target age (riktålder) is 67. The later you start, the more you get each month. Years without income earn no pension, so count on a lower one.

The occupational pension

It can often be drawn from age 55 in the private sector; for municipal and regional employees the limit is higher, so check your agreement. It is usually paid over at least 5 years and taxed as income.

Your own money

It bridges the years until then. Without a salary the tax on an early occupational pension is lower, and spread over more years it stays below the threshold for state income tax.

An example

Say you stop working at 50. Until 55 your own money pays for everything. Then you spread the occupational pension over the years up to 67, when the public pension starts. Your own money does not have to pay for everything for 40 years, only for what the pensions do not cover.

See your pension forecast on minPension

A year in practice

Have a salary account and a savings account outside the ISK, with the buffer in the savings account.
Set up a monthly transfer from the savings account to the salary account: your own salary.
Once a year, look at how the market went. If it went up, sell fund units on the ISK for next year's spending and fill up the buffer. If it went down, leave the funds alone.
Put money aside for the ISK tax. Without a salary no tax is withheld, so it comes as back tax: pay it into your tax account in advance to avoid interest.
Work out the withdrawal again with the year's numbers, and adjust it if the share has drifted.FIRE Calculator

Before you stop working

Home loan: the bank wants to see an income. Move home or move the loan before you stop.
Sickness and parental benefit are based on your income (SGI). Without work it is soon gone, which matters if you plan to have children.
Without a salary it can be harder to rent a flat or borrow, even with money in the bank.
Unmarried couples: the cohabitation act (sambolagen) only shares the joint home and household goods, not savings, and cohabitants do not inherit each other without a will. Write wills, and name each other as beneficiaries where you can.
Try it first: live for a year on the amount you plan to take out, while you still have the salary.

Questions

Should I move my regular account to an ISK?

Moving holdings to an ISK counts as selling them, so you pay tax on the gain at once. With large gains it can be better to leave them and sell from there in the withdrawal phase, while new money goes into the ISK.

What if the ISK tax goes up?

The rate follows the government borrowing rate on 30 November the year before, so it changes every year: 1.065 % in 2026. Plan with some margin. When interest rates rise, the interest on the buffer usually rises too.

Can I live on the interest of a savings account?

Hardly. The interest on a savings account has often been about as high as inflation, so little is left after inflation. A savings account is for the buffer, not for all the money.

Do I have to sell every month?

No. Selling once or a few times a year is enough, with the savings account paying you a monthly salary. Fewer decisions, and less to think about.

Accumulating or distributing funds?

Most Swedish index funds reinvest their dividends, and some also have a share class that pays them out. On an ISK the difference is mostly how the money arrives: a distributing fund pays it out, and with an accumulating one you sell yourself.

How does it work for a couple?

Each of you has your own tax-free amount on ISK, so it pays to spread the savings. Agree on a shared withdrawal and buffer, and remember that the money on each ISK belongs to the one who owns it. In Sambokoll you can plan the budget together.

General information, not financial advice. Taxes and rules as of 2026; they change, often every year.

Work out your own path

The FIRE calculator shows when you can stop, with good and bad years on the stock market. Lower the return by a percentage point for the ISK tax, and keep the goal at 30 times a year's spending.

Open the FIRE calculator Start a shared budget