Savings and Withdrawal Calculator
Use this calculator to estimate how long your savings will last, or what your remaining balance might be after a certain period, considering annual investment returns, withdrawals, and inflation.
Calculation Results:
"; if (currentBalance <= 0) { resultHTML += "Based on your inputs, your savings are projected to last approximately " + yearsLasted.toFixed(1) + " years."; resultHTML += "Total amount withdrawn before depletion: $" + totalWithdrawn.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + ""; resultHTML += "Total investment growth realized: $" + totalGrowth.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + ""; } else { resultHTML += "Your savings are projected to last beyond " + projectionYears + " years."; resultHTML += "After " + projectionYears + " years, your remaining balance will be: $" + currentBalance.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + ""; resultHTML += "Total amount withdrawn over " + projectionYears + " years: $" + totalWithdrawn.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + ""; resultHTML += "Total investment growth realized over " + projectionYears + " years: $" + totalGrowth.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + ""; } // Optional: Display year-by-year breakdown // resultHTML += "Year-by-Year Breakdown:
"; // resultHTML += "| Year | Start Balance | Growth | Withdrawal | End Balance | Nominal Withdrawal (for next year) |
|---|---|---|---|---|---|
| " + detail.year + " | "; // resultHTML += "$" + detail.startBalance.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + " | "; // resultHTML += "$" + detail.growth.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + " | "; // resultHTML += "$" + detail.withdrawal.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + " | "; // resultHTML += "$" + detail.endBalance.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + " | "; // resultHTML += "$" + detail.nominalWithdrawal.toLocaleString(undefined, { minimumFractionDigits: 2, maximumFractionDigits: 2 }) + " | "; // resultHTML += "
Understanding Your Savings and Withdrawal Potential
Planning for the future, especially retirement or a period of financial independence, requires a clear understanding of how long your savings will last. Our Savings and Withdrawal Calculator helps you project the longevity of your nest egg by considering key financial factors.
How the Calculator Works
This tool simulates the performance of your savings over a specified number of years, taking into account your initial capital, the returns your investments generate, the amount you plan to withdraw annually, and the impact of inflation on your purchasing power.
- Current Savings Amount: This is the total sum of money you currently have saved or invested that you intend to draw from. It forms the foundation of your financial projection.
- Annual Investment Return (%): This represents the average annual percentage gain you expect your investments to generate. It's crucial to use a realistic long-term average, considering market volatility and your risk tolerance.
- Desired Annual Withdrawal ($): This is the amount of money you wish to withdraw from your savings each year. The calculator assumes you want to maintain the purchasing power of this amount, meaning the nominal withdrawal will increase with inflation over time.
- Annual Inflation Rate (%): Inflation erodes the purchasing power of money over time. This input accounts for how much more money you'll need each year to buy the same goods and services, directly impacting how long your savings will last.
- Years to Project: This is the maximum number of years you want to simulate. The calculator will show you if your savings last beyond this period or when they are projected to run out within this timeframe.
The Impact of Each Variable
Each input plays a significant role in the outcome:
- Higher Initial Savings: Naturally, a larger starting sum provides a longer runway for withdrawals.
- Higher Investment Returns: Stronger returns mean your money grows faster, offsetting withdrawals and extending the life of your savings. Even a small difference in return rate can have a massive impact over decades.
- Lower Annual Withdrawals: Reducing your annual spending is one of the most effective ways to make your savings last longer.
- Lower Inflation: When inflation is low, your money retains its value better, and the nominal amount you need to withdraw each year to maintain your lifestyle grows more slowly.
Example Scenario:
Let's say you have $500,000 in savings. You expect an Annual Investment Return of 7%. You plan to withdraw $30,000 annually, and you anticipate an Annual Inflation Rate of 3%. You want to project this over 30 years.
In this scenario, the calculator would simulate how your $500,000 balance changes each year. It would add 7% growth to the remaining balance, then subtract the inflation-adjusted withdrawal for that year. For instance, in year one, you withdraw $30,000. In year two, to maintain the same purchasing power, you'd withdraw $30,000 * (1 + 0.03) = $30,900, and so on.
The calculator will then tell you if your savings last the full 30 years, and if so, what your remaining balance would be, or at what point within those 30 years your funds are projected to be depleted.
This tool is invaluable for retirement planning, assessing financial independence goals, or simply understanding the long-term viability of your current savings strategy. Remember, these are projections, and actual results may vary based on market performance and personal spending habits.