How Long Will My Retirement Savings Last?

Shawn Plummer

CEO, The Annuity Expert

The golden years of retirement should be a time of relaxation and enjoyment, a hard-earned reward for a lifetime of work. But the question many of us grapple with is, “How long will my retirement savings last?” This question is prudent and essential for peace of mind and financial security. Whether you’re near retirement or planning ahead, understanding the lifespan of your nest egg can help you better prepare for a comfortable future.

This retirement plan is ideal for the following:

If you are far from retiring (Ages 30-54), follow this step-by-step guide to guarantee your future retirement, starting today.

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Are you planning for retirement and unsure where to begin? Visit our Learning Lab for expert guidance and insights.

Can You Run Out Of Retirement Money?

The first thing to understand is that running out of retirement money is possible. This typically happens when people don’t plan carefully for their retirement income and essential expenses. As a result, they may spend more than expected or not have enough income to cover their costs.

How Long Will My Retirement Savings Last

Retirement Savings Longevity Calculator

How long will my money last with systematic withdrawals? This calculator is designed to help you estimate how long your retirement savings might last based on your current savings, yearly contributions, expected rate of return, and retirement age.

But remember, a calculator is a tool—not a fortune teller. It can’t predict the future (the calculator below can, though), but it can give you a solid estimate based on the data you provided. While these calculations can be a great starting point, they should be supplemented with personalized advice from a financial advisor.

How Long Will Money Last Using The 4% Rule

Next, let’s explore the 4% rule. This guideline suggests that you can withdraw 4% of your retirement savings during the first year of retirement and then adjust that amount each subsequent year for inflation. Following this strategy, your money should last for at least 30 years in retirement.

For example, let’s say you have $100,000 in retirement savings. Using the four percent rule, you could withdraw $4,000 annually ($100,000 x 0.04) and still have enough money to last 30 years.

However, the 4% rule is not a one-size-fits-all strategy. It’s based on historical data and may not apply to everyone, especially given the market’s uncertainties and personal circumstances. That’s why it’s essential to consider other factors, such as your lifestyle, health, and other income sources when planning your retirement.

The Impact of Inflation on Retirement Savings

Inflation is an often overlooked but critical factor when calculating the longevity of your retirement savings. That’s where our “how long will my retirement savings last with inflation calculator” comes into play. This tool can help you understand how rising prices erode your purchasing power over time.

For instance, if you have $1,000,000 in retirement savings and inflation averages 2% per year, in 20 years, you’d need about $1,485,000 to have the same purchasing power as $1,000,000 today. Therefore, accounting for inflation in your retirement planning can help ensure your savings last as long as needed.

How Long Will My Savings Last Using Systematic Withdrawals?

Systematic withdrawals can be an effective way to ensure your money lasts throughout retirement. This strategy involves withdrawing a set amount from your retirement savings at regular intervals, such as monthly or annually.

The key to a successful systematic withdrawal strategy is balancing preserving your savings and maintaining your desired lifestyle. Again, a financial advisor can help you design a plan that fits your needs and goals.

How Long Will My Money Last In Retirement?

Annuities: A Guaranteed Lifetime Income Rider

Annuities are insurance products that can provide a guaranteed income for life, making them an attractive option for those worried about outliving their savings. Annuities can be structured in various ways, but a popular choice for retirees is the lifetime income rider.

This rider guarantees a stream of income for as long as you live, regardless of how the investment component of the annuity performs. It can be a powerful tool for ensuring your retirement savings last, but it’s important to understand the costs and terms associated with annuities before deciding.

How Long Will My Retirement Savings Last?

How Long Will My Money Last In Retirement Calculator

Annuities can distribute regular withdrawals without the worry of running out of money. Use our free annuity calculator to estimate how much retirement income you can collect for the rest of your life.

How Long Will My Money Last

Next Steps: Ensuring Your Retirement Savings Last

The most important thing to remember when deciding how long your money will last is that it is not always an exact science; there are a lot of variables to consider and strategies that can be used to make your money last as long as possible. Understanding the various aspects of financial planning and investments, working with a qualified financial adviser, creating a plan, and budgeting wisely can all go a long way toward helping you figure out how long your money will last.

With the right tools and information, you can create a plan that works for you and give yourself peace of mind, knowing you are responsible for your finances. Contact us to discuss your individual needs!

How Long Will My Money Last With Retirement

How Long Will My Retirement Savings Last Quotes

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Frequently Asked Questions

These are commonly asked Americans questions about when they can retire and whether they have enough savings to retire.

How long should retirement savings last?

Retirement savings should ideally last throughout your lifetime. This duration depends on factors such as your age at retirement, lifestyle, healthcare needs, and other income sources. Annuities are insurance policies that ensure a retiree never runs out of money.

How long will money last using the 4% rule?

The 4% rule suggests that if you withdraw 4% of your retirement savings in the first year and adjust for inflation in subsequent years, your money should ideally last for at least 30 years. However, this rule doesn’t account for personal circumstances or market unpredictability, so that individual results may vary.

*Disclosure: Some of the links in this guide may be affiliate links. I may receive a commission at no cost if you purchase a policy. It helps us keep the lights on!

Shawn Plummer

CEO, The Annuity Expert

I’m a licensed financial professional focusing on annuities and insurance for more than a decade. My former role was training financial advisors, including for a Fortune Global 500 insurance company. I’ve been featured in Time Magazine, Yahoo! Finance, MSN, SmartAsset, Entrepreneur, Bloomberg, The Simple Dollar, U.S. News and World Report, and Women’s Health Magazine.

The Annuity Expert is an online insurance agency servicing consumers across the United States. My goal is to help you take the guesswork out of retirement planning or find the best insurance coverage at the cheapest rates for you. 

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