Savings Withdrawal Calculator: Know How Long Your Money Will Last

Our Savings Withdrawal Calculator helps you plan for your financial future with confidence. Determine how long your money will last and budget accordingly for your retirement and other long-term goals.

Life Expectancy and Retirement Age

As you plan for retirement, it's important to consider your life expectancy and retirement age. Average life expectancy has been increasing steadily over the years, which means that you may need to plan for a longer retirement than previous generations. According to the Social Security Administration, a man who reaches age 65 today can expect to live, on average, until age 84.3, while a woman who reaches age 65 can expect to live until age 86.7.

Retirement age is also a crucial factor to consider when planning for retirement. Retirement age trends have been changing over time, with many individuals opting to work longer in order to save more money and increase their retirement income. In fact, the average retirement age has been increasing over the past few decades, and many people are now choosing to work well into their 60s and 70s.

Knowing your life expectancy and retirement age can help you make more informed decisions about your retirement savings and withdrawal rate. By taking these factors into account, you can ensure that you have enough savings to support you throughout your retirement years.

Historical Market Trends

Understanding historical market trends is an important part of retirement planning. By analyzing market trends, you can get a sense of how the stock market and other investment vehicles have performed over time, and how those trends might affect your retirement savings.

For example, many investors are familiar with the stock market crash of 2008, which led to a significant downturn in the market and a corresponding drop in the value of many retirement accounts. However, it's important to note that the market has historically recovered from such downturns over time, and that a long-term investment strategy can help weather short-term fluctuations.

By examining market trends over the past few decades, you can also get a sense of how different asset classes have performed over time, and how to allocate your retirement savings accordingly. For example, many investors choose to invest in a mix of stocks and bonds in order to balance risk and reward.

At our Investment Time Machine, we offer a unique tool that lets you explore historical market trends and simulate different investment scenarios. With our Investment Time Machine app, you can pretend you invested in any point in time since 1928 and see how your investments would have performed over time. Check it out today to start planning for your financial future!

Alternative Retirement Strategies

When planning for retirement, there's no one-size-fits-all solution. Everyone's financial situation and retirement goals are unique, and there are a variety of alternative retirement strategies to consider.

One option is to continue working in some capacity during retirement. This could involve part-time work, consulting, or starting a small business. By continuing to earn income during retirement, you can supplement your retirement savings and potentially delay the need to withdraw funds from your savings account.

Another alternative retirement strategy is to downsize your living arrangements. By moving to a smaller home or relocating to a more affordable area, you can reduce your living expenses and stretch your retirement savings further.

You could also consider a phased retirement, where you gradually reduce your work hours and transition into full retirement over time. This can provide a gradual adjustment to the lifestyle and financial changes that come with retirement.

Regardless of which alternative retirement strategy you choose, it's important to carefully consider your options and make informed decisions that align with your retirement goals and financial situation.

Tax Planning and Retirement

Taxes are an important consideration when it comes to retirement planning. By understanding the tax implications of your retirement accounts and income sources, you can potentially reduce your tax burden and maximize your retirement savings.

One important tax consideration is the type of retirement account you choose. Traditional retirement accounts, such as 401(k)s and traditional IRAs, allow you to contribute pre-tax income, which can reduce your current tax bill. However, withdrawals from these accounts are typically taxed as ordinary income.

Roth retirement accounts, on the other hand, are funded with after-tax dollars, so you don't get an immediate tax break for contributions. However, qualified withdrawals from these accounts are typically tax-free.

Another important tax consideration is the timing and structure of your retirement income. By carefully managing your withdrawals from retirement accounts and other income sources, you can potentially reduce your tax liability and make the most of your retirement savings.

At the same time, it's important to be aware of potential tax pitfalls and plan accordingly. For example, if you withdraw funds from a traditional retirement account before age 59 1/2, you may be subject to a penalty in addition to ordinary income tax.

By working with a financial advisor and carefully planning your retirement income strategy, you can make the most of your retirement savings and potentially reduce your tax burden along the way.

Health Care Costs in Retirement

Health care is a major expense for many retirees, and it's important to factor these costs into your retirement planning. While Medicare can cover many health care costs in retirement, it's not a complete solution, and you may need to plan for additional expenses.

One important consideration is the cost of long-term care. As you age, the likelihood of needing long-term care, such as assisted living or nursing home care, increases. These costs can be substantial and can quickly deplete your retirement savings if you're not prepared.

Another important consideration is the cost of prescription drugs. Medicare provides some coverage for prescription drugs, but you may need to purchase additional coverage to cover all of your medications. It's important to carefully consider your prescription drug needs and shop around for the best coverage options.

Finally, it's important to maintain a healthy lifestyle and stay on top of preventative care to minimize the risk of costly medical issues in retirement. This includes things like regular check-ups, exercise, and a healthy diet.

By factoring health care costs into your retirement planning and taking steps to stay healthy, you can help ensure a more financially secure and comfortable retirement.

Travel and Leisure in Retirement

Retirement can be a great time to travel and explore new places, and it's important to factor these costs into your retirement planning. Travel and leisure expenses can vary widely depending on your interests and travel style, so it's important to carefully consider your budget and priorities.

One popular option for retirees is to travel domestically, exploring different regions of the country or visiting family and friends. This can be a more affordable option, especially if you have access to a vehicle or can take advantage of senior discounts.

International travel is another popular option, and there are many retirement-friendly destinations around the world. However, international travel can be more expensive and requires careful planning to ensure you have the necessary documentation and vaccinations.

Even if you're not interested in traveling, retirement can be a great time to pursue hobbies and interests that you may not have had time for during your working years. This can include things like golf, gardening, or volunteering in your community.

Ultimately, the key is to carefully consider your priorities and budget for travel and leisure expenses in retirement. By doing so, you can help ensure a more fulfilling and enjoyable retirement.

Community and Volunteering in Retirement

Retirement can be a great time to get involved in your community and give back through volunteering. Volunteering can provide a sense of purpose and fulfillment, while also helping you stay active and engaged in your community.

There are many different types of volunteer opportunities available, from serving meals at a local shelter to tutoring children in reading or math. Consider your interests and skills when looking for volunteer opportunities, and don't be afraid to try something new.

Volunteering can also provide social opportunities and help you build new connections in your community. This can be especially valuable if you're moving to a new area or looking to expand your social circle in retirement.

In addition to volunteering, there are many other ways to get involved in your community in retirement. This can include attending local events, joining clubs or organizations, or even running for local office.

By getting involved in your community and volunteering, you can help ensure a more fulfilling and meaningful retirement while also making a positive impact on those around you.

Future Financial Planning

Retirement planning is an ongoing process, and it's important to regularly review and update your financial plan to ensure you're on track to meet your goals. This can include things like adjusting your savings rate, rebalancing your investment portfolio, or updating your retirement income projections.

It's also important to consider other future financial planning needs, such as estate planning and long-term care planning. These can be complex topics, but it's important to address them sooner rather than later to ensure your wishes are carried out and to avoid unnecessary costs or complications.

As you near retirement, you may also want to consider whether to delay Social Security benefits to maximize your retirement income. There are many factors to consider, such as your health, income needs, and other sources of retirement income.

Ultimately, the key to future financial planning is to regularly review and update your plan to ensure you're on track to meet your goals and adjust as needed based on changes in your circumstances or the broader economic environment.