Retirement savings and an illustrative withdrawal budget
Retirement planning involves two different questions: how large a fund might become before retirement, and how much you might draw from it afterward. This page projects current savings plus regular monthly contributions until a chosen retirement age. It then applies your selected annual withdrawal percentage and divides by twelve. That monthly figure is a planning illustration, not a pension quotation or a promise that the fund will last. State benefits, workplace pensions and other income are not automatically included.
How the accumulation estimate works
Years remaining = retirement age − current age, with a minimum of zero. Monthly periods n = years × 12 and monthly rate r = annual return / 100 / 12. Future value = PV × (1 + r)^n + PMT × ((1 + r)^n − 1) / r. Contributions are assumed at month end. At zero return the contribution portion is PMT × n.
The result assumes a steady rate and a constant contribution, not changing salaries, investment losses or interrupted employment. It omits fees, tax and automatic inflation adjustment. If retirement age is at or below current age, no future saving periods are added. Consider alternative contribution amounts and later or earlier retirement ages to understand which inputs have the largest effect.
A withdrawal percentage is not a guarantee
Illustrative monthly withdrawal = projected fund × annual withdrawal percentage / 100 / 12. A 4% input on a 300,000 fund therefore gives 1,000 per month in the same currency. The historical 4% guideline concerns an initial withdrawal followed by inflation-adjusted spending, not an unconditional safe income for every portfolio or country.
This page does not simulate the retirement drawdown years, sequence-of-returns risk, changing inflation or longevity. Compare your estimate with a retirement spending budget and local pension rules. Keep nominal and real returns distinct: a 5% nominal return is not the same as a 5% return after inflation. Higher assumed returns or withdrawal rates can make a plan look easier without making it safer.
Worked examples
Age 50 to 60, monthly saving
Starting with USD 10,000, contributing USD 200 at each month end, and assuming 5% annual return divided monthly gives about USD 47,526.55 after ten years. Applying a 4% annual withdrawal rate produces an illustrative USD 158.42 per month before tax.
Separate income from savings
A hypothetical GBP 300,000 fund at a 4% withdrawal input produces GBP 12,000 per year, or GBP 1,000 per month. Add any verified pension income separately and compare the combined figure with your anticipated expenses.
Frequently asked questions
Is the displayed monthly income guaranteed?
No. It is the projected balance multiplied by a selected withdrawal rate. The tool does not test how long withdrawals last.
Are pensions included?
No. State, employer and defined-benefit pension income must be considered separately.
Should I use nominal or real returns?
Decide which basis your budget uses and stay consistent. There is no automatic inflation conversion in this calculator.
What if I have already reached retirement age?
The calculator adds zero future saving periods when the chosen retirement age is no higher than your current age.