How long will my savings last
If you live off your savings, for example in retirement or on a career break, what matters is how long they will last. Work out how many years they last with what you withdraw each month and how much you could withdraw to make them last as long as you need.
Year by year
| Year | Monthly withdrawal | Balance at year end |
|---|
How to work out how long your savings will last
Enter the savings you will live on, what you withdraw each month, the return on the money left and how much you will raise the withdrawal each year. The calculator tells you how many years they last, how much you withdraw in total, how much returns contribute and how much you could withdraw to make them last as long as you want.
Example: with 200,000, withdrawing 1,000 a month and raising it 2% each year, if the remaining money earns 3% a year, your savings last 18 years and 4 months. In total you withdraw 263,113, of which 63,113 comes from returns. To make them last 25 years, you could start by withdrawing 758 a month.
How it is calculated
- Each month you withdraw the amount at the start of the month and the rest earns the monthly return: (1 + annual)^(1/12) − 1.
- The withdrawal rises once a year by the percentage you enter, to keep its purchasing power.
- Duration = months in which you can withdraw the full amount. Withdrawal for a time frame: the one that leaves the balance at zero right at the end.
Assumptions
- The same return every year: in reality it varies and some years are negative.
- No taxes or fees, unless you take them off the return.
- If returns cover the withdrawals for 100 years, the savings are treated as never running out.
Frequently asked questions
How do you calculate how long savings will last?
Each month your withdrawal is taken out and the rest earns the return you enter. The duration is the number of months you can withdraw the full amount. With no return and no increases it is simply savings ÷ withdrawal: 200,000 at 1,000 a month lasts 16 years and 8 months.
Why raise the withdrawal each year?
Because as prices rise, the same amount buys less each year. Raising the withdrawal with inflation keeps your standard of living, but your savings run out sooner.
What return should I use?
What you expect the money you have not yet withdrawn to earn, after fees. If it sits in an account, use its interest rate; if it is invested, be cautious: real returns change every year and some years are negative. Try several.
How much can I withdraw to make my savings last X years?
Enter the years in “Years you want them to last” and the calculator gives you the starting monthly withdrawal that leaves the balance at zero right at the end, with the same return and yearly increase.
What is the 4% rule?
A widely quoted guideline based on historical US stock market data: withdraw about 4% of your savings in the first year and then raise it with inflation. It is not a guarantee and depends on how the savings are invested; this calculator lets you test your own figures.