How Long Will Money Last? Retirement Run-Out Tool

This calculator helps you estimate how long your savings can cover your living costs before you run out of money. It's useful for retirees, anyone living off investments, or people planning a career break. You enter your starting balance, spending amount, expected investment return, and inflation (optional). The tool then estimates how many months or years your money may last and can also show a projected "run-out" point. It's a simple way to stress-test your plan, compare different spending levels, and see how inflation and investment growth can change the outcome.

How to Use This Calculator

1. Enter your starting savings balance (the amount you plan to use).
2. Add your withdrawal amount (monthly or yearly spending from savings).
3. Set an expected investment return (how fast your money may grow).
4. Add inflation (so your spending can rise over time, if you want).
5. Include any extra income (pension, part-time work) if the tool supports it.
6. Click Calculate to see how long the money may last.
7. Adjust one input at a time to compare scenarios (spend less, earn more, change return).

What This Calculator Measures

This calculator estimates your financial runway—how long your available money can support your withdrawals.

Key terms in plain language:

• Starting balance: The money you begin with (savings + investments you'll spend).
• Withdrawal (spending): The amount you take out to cover costs.
• Investment return: The growth rate of your balance over time (can be positive or low).
• Inflation: The increase in prices over time. If included, it raises your future spending.
• Time to depletion: The estimated point when your balance reaches zero.
• Remaining balance: If your withdrawals are small enough, you may not run out within the modeled period (depending on tool settings).

Formula or Logic (Easy Explanation)

Instead of using heavy math, most "money runway" tools follow a simple loop:

• Start with your current balance.
• Each period (often monthly), your balance may grow by the return rate.
• Then you subtract your withdrawal for that period.
• If inflation is included, the withdrawal amount increases over time.
• The calculator repeats this step-by-step until the balance hits zero (or until the maximum timeline ends).

This is basically a "grow then spend" simulation that shows how long your funds can support your plan.

Example Calculations

Example 1: Moderate savings, steady spending

• Starting balance: $250,000
• Monthly withdrawal: $2,000
• Annual return: 4%
• Annual inflation: 2%
• Result: About 11 years 9 months (money runs out around month 141)

Example 2: Larger balance, higher withdrawal

• Starting balance: $600,000
• Monthly withdrawal: $3,000
• Annual return: 5%
• Annual inflation: 2%
• Result: About 22 years 11 months (money runs out around month 275)

Example 3: Lower return with higher inflation

• Starting balance: $150,000
• Monthly withdrawal: $1,500
• Annual return: 3%
• Annual inflation: 3%
• Result: About 8 years 5 months (money runs out around month 101)

Understanding Your Results

Your result is usually shown as a time length (months/years) and sometimes a run-out date.

What the numbers mean:

• A short runway means your withdrawals are high compared to your balance (or inflation is pushing spending up quickly).
• A long runway usually means you're withdrawing less, earning more return, or both.
• If the tool shows your money does not run out, it often means that under your inputs, growth keeps up with (or beats) withdrawals during the modeled timeframe.

Keep in mind: real life can change. Returns can vary year to year, and spending is rarely perfectly stable.

Common Mistakes to Avoid

• Entering gross income instead of the amount you'll actually withdraw from savings.
• Forgetting to include inflation, which can make future spending higher.
• Assuming a single return rate is guaranteed (returns can change over time).
• Ignoring taxes and account rules if withdrawals come from taxable or retirement accounts.
• Mixing monthly and yearly numbers (example: monthly spending with yearly income).
• Using your full net worth instead of the portion you can realistically spend.
• Leaving out one-time costs like medical bills, home repairs, or major purchases.