How long will my retirement savings last?

Use this calculator to see how long your retirement savings will last. This is based on your retirement savings and your inflation adjusted withdrawals.

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Cumulative savings at retirement
Enter how much you have saved to-date for retirement. Then add to this number how much you can realistically save between now and your retirement date. Finally, add in any estimated net after-tax dollars you expect to receive from the sale of real estate, a business, or any item of value at or near your retirement date. Do not count expected inheritances or return on investments. Use today's values, not anticipated future values.

Amount you want to spend annually in retirement
How much money do you want to spend annually in retirement including payment of taxes. Use today's dollars. Subtract from this number annual social security, pension, or other lifetime income sources. Be careful not to underestimate living expenses and taxes. Doing so could cause serious cash-flow shortages later on.

After tax rate of return in retirement
This is the annual rate of return you expect from your investments after taxes. The actual rate of return is largely dependent on the type of investments you select. For example, from December 2000 to December 2010, the annual compounded rate of return for the S&P 500 was 0.899%, including reinvestment of dividends. From January 1970 to December 2010, the average annual compounded rate of return for the S&P 500, including reinvestment of dividends, was approximately 10.05% (source: Since 1970, the highest 12-month return was 61% (June 1982 through June 1983). The lowest 12-month return was -43% (March 2008 to March 2009). Savings accounts at a bank may pay as little as 1% or less but carry significantly lower risk of loss of principal balances.

It is important to remember that these scenarios are hypothetical and that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are generally subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect sales charges and other fees that funds and/or investment companies may charge.

When you are taking periodic distributions from an account or investment, the return earned is often lower due to more conservative investment choices to help insure a steady flow of income.

Expected inflation rate
What you expect for the average long-term inflation rate. A common measure of inflation in the U.S. is the Consumer Price Index (CPI). The CPI for 2010 was 2.4%, as reported by the Minneapolis Federal Reserve. From 1925 through 2010 the CPI has long-term average of 3.1% annually. Over the last 30 years highest CPI recorded was 13.5% in 1980. This calculator increases your distribution amount at the end of each year by the rate of inflation. This begins at end of the first year of distributions. This helps illustrate the cost of providing a current amount of purchasing power throughout your distributions.

Additional advanced cash folw inputs
These inputs allow you to account for addition income or withdrawals that happen during retirement. All additional inputs are considered to be annual amounts that happen at the beginning of the year.  If you have two items that overlap, they will offset (or partially offset) each other.  The inputs allow for 10 lines (one pre extra withdrawal or deposit) and consist of:  
  1. Amount: Amount to deposit or withdraw. Since these are cash flow items, negative numbers are withdrawals, and positive numbers are deposits.  If no amount is entered, we blank out the two years fields.
  2. Year to start: First year of the item be deposited or withdrawn.  This is a year, with the current year (2011) the lowest number allowed.  If the year to end it blank or less than year to start we enter the year to start in this field as its default.
  3. Year to end: Default is to be the same as the year to start, but you can change it to any year after the year to start.
If the year to start is the same as the year to end, we assume the amount is deposited or withdrawn only once at the beginnging of that year.