This fixed annual withdrawal is an annuity (much like the annuities you can buy from an insurance company), and there’s a technical formula (called the present value formula for an annuity) for calculating how much you’d need to start with to generate a given annuity. If you were to plug these numbers into that formula, you would find that the initial $212,000 will last you nearly until the end. (To be precise, you need to start with $213,210.12 if you want your money to last 25 years at 3 percent interest and a $12,000 annual withdrawal.)
