Estimate sustainable withdrawals using inflation adjusted income planning. Test pension, healthcare, taxes, and portfolio assumptions. See yearly balances, shortfalls, and safer retirement decisions clearly.
| Scenario | Start Portfolio | Monthly Spending | Fixed Income | Return | Inflation | Outcome Snapshot |
|---|---|---|---|---|---|---|
| Balanced Base | $750,000 | $4,500 | $3,800 | 5.5% | 3.0% | Likely sustainable with moderate surplus |
| Higher Healthcare | $750,000 | $5,400 | $3,800 | 5.5% | 3.0% | Higher withdrawals increase depletion risk |
| Conservative Return | $750,000 | $4,500 | $3,800 | 4.0% | 3.0% | Required capital rises and surplus narrows |
| Income-Heavy | $550,000 | $4,500 | $4,400 | 5.0% | 2.5% | Smaller portfolio may still work well |
1) Portfolio growth before retirement
Portfolio(next) = Portfolio × (1 + pre-ret return) + annual contribution
2) Spending projection in retirement
Annual spending(year n) = Base spending at retirement × (1 + inflation)^(n-1)
3) Net fixed income after taxes
Net fixed income = (Pension + Social Security + Other income) × (1 − tax rate)
4) Gross withdrawal needed from portfolio
Required withdrawal = Max(0, spending + one-time expense − net fixed income) ÷ (1 − tax rate)
5) Retirement-year portfolio update
Closing balance = Opening balance + (Opening × retirement return) − actual withdrawal
6) Required capital at retirement
Required capital = Σ (projected withdrawals ÷ (1 + return)^year) + bequest goal PV
This planner uses deterministic assumptions for inflation, returns, and taxes. Real life results can vary due to market volatility, healthcare changes, and policy updates.
A practical planner starts by comparing annual spending with reliable income. If expected retirement spending is 54,000 and combined pension, social security, and other income totals 39,600, the coverage ratio is 73.3 percent. The remaining 14,400 must come from portfolio withdrawals. This ratio shows whether lifestyle assumptions are conservative, balanced, or aggressive, and it helps users adjust timing, expenses, or income expectations before retirement.
Inflation is often underestimated in post-retirement planning. A monthly expense plan of 4,500 becomes roughly 6,047 after ten years at 3 percent inflation. Healthcare often rises faster, so a separate healthcare line improves realism. By entering category-based monthly costs, users can clearly see how fixed income loses purchasing power and why withdrawals increase over time, even when lifestyle choices remain unchanged.
Portfolio longevity depends on return assumptions, withdrawal timing, and sequence risk. For example, a 900,000 retirement portfolio with 5.5 percent average return and 42,000 first-year withdrawals may last beyond age 90 under moderate inflation. The same portfolio can deplete earlier if withdrawals rise sharply or returns fall below plan. Reviewing yearly opening balance, growth, and closing balance helps identify drawdown pressure and timely rebalance decisions early.
Taxes affect sustainable withdrawals because distributions may need gross-up. If a retiree needs 20,000 net and pays 12 percent tax, the withdrawal requirement becomes about 22,727. Emergency reserves matter too. Holding twelve months of core expenses reduces forced selling during market declines. One-time costs, such as home repairs or family support, should be entered explicitly so the planner reflects real cash shocks instead of hiding them inside monthly assumptions.
The strongest use of this planner is comparison. Run a baseline case, then test later retirement age, lower discretionary spending, or higher savings before retirement. Small changes produce measurable effects. Delaying retirement by two years can increase savings, shorten withdrawal years, and raise guaranteed income eligibility. Summary metrics, projection rows, and exports support better discussions with family members and financial advisors.
Yes. Enter a lower retirement age, adjust Social Security start age, and use realistic healthcare and inflation assumptions. Comparing multiple scenarios helps evaluate early retirement sustainability and portfolio stress.
Yes. The calculator inflates retirement spending annually using your inflation rate input, so projected withdrawals and income gaps increase over time instead of staying flat.
Because withdrawals are grossed up for taxes. If you need a net amount after taxes, the calculator estimates the larger withdrawal needed to cover both spending and tax impact.
It is the estimated portfolio needed at retirement to fund projected withdrawals through your life expectancy, while also considering investment returns and any bequest goal entered.
Yes. Use the one-time expense field for items like renovations, travel, debt payoff, or family support. The projection includes this cost in the first retirement year.
Use it for planning and comparison, not as personalized advice. Review results with a qualified financial advisor, especially for taxes, healthcare costs, and withdrawal strategies.
Important Note: All the Calculators listed in this site are for educational purpose only and we do not guarentee the accuracy of results. Please do consult with other sources as well.