Calculators & Finance

Retirement Calculator

Projected pot, and how long it lasts in drawdown.

What it does. Two halves that are usually calculated separately and should not be. Accumulation projects the pot from contributions and returns; drawdown asks how long that pot lasts. The number that connects them is the withdrawal rate, and the widely quoted 4% figure comes from a specific study with specific assumptions that are worth knowing.

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How to use Retirement Calculator

Enter your age, current pot and monthly contribution.
Set return, inflation and retirement age.
Choose a withdrawal rate and see how long the pot lasts.

Where the 4% rule comes from

It comes from the Trinity study of the 1990s, which tested historical US market data and found that withdrawing 4% of the initial pot, rising with inflation, survived 30 years in almost every historical period.

That is a narrower claim than the way it is usually repeated. It was US data, a 30-year horizon, a specific stock/bond mix, and it ignored fees.

Later work using global rather than US data, and longer retirements, generally produces a lower safe figure — often nearer 3 to 3.5%. If you retire early and need the pot to last 40 years, 4% is optimistic rather than conservative.

The number that moves the answer most

Not the return. The retirement age.

Working two years longer adds two years of contributions, two years of growth, and removes two years of withdrawals. It moves the outcome more than a percentage point of return in either direction, and unlike the return it is a decision rather than a hope.

The second most powerful lever is the contribution rate early on, because those pounds compound for the longest. A pound at 25 does the work of roughly four pounds at 45 over a normal career.

What a projection cannot tell you

Sequence risk. A poor decade immediately after retiring is the scenario that breaks plans, and an average return hides it.
State pension and other income, which change how much the pot has to do.
Tax on withdrawals, which varies by country and wrapper.
Care costs, the largest unpriced risk in most retirements.
How long you will live, which is the whole question and unknowable.

Because of that last one, a plan that runs out at exactly the actuarial average is a plan that fails for half of people. Building in a margin is not pessimism; it is the correct reading of what an average means.

Frequently asked questions

Is the 4% rule safe?

It comes from a study of US data over 30-year retirements with a specific asset mix and no fees. Work using global data or longer horizons often lands nearer 3–3.5%. For an early retirement needing 40 years, 4% is optimistic.

What matters most in a retirement projection?

Retirement age. Working two years longer adds contributions and growth while removing two years of withdrawals — it moves the outcome more than a percentage point of return, and it is a decision rather than a hope.

How much should I contribute?

As early as possible matters more than how much. A pound invested at 25 does roughly the work of four pounds at 45 over a normal career, because it compounds for twenty more years.

What is sequence risk?

The risk that poor returns arrive just after you retire, when the pot is largest and you are withdrawing from it. The same average return is far more damaging in that order, and an average-return projection cannot show it.

Does this include the state pension or tax?

No. It projects a pot and its drawdown. Other income and the tax treatment of withdrawals vary by country and wrapper, and both change how much the pot itself needs to do.