![]() Related article: How Much Super Do You Need to Retire?Ī key factor in determining how long your money will last in retirement is how your super is invested. for 30 years, you would need a combined super balance of $485,000. The dollar amount in each box is the amount of super savings you need to retire at the age at the top of the table for the number of years specified below the age while covering expenses equal to the amount on the left of the table.įor example, if you are a couple and would like to retire at age 60, coving retirement expenses of $50,000 p.a. Related article: How Much Does a Single Person Need for Retirement? You can use this information to calculate how long your savings will last in retirement, based on the age you want to retire and the level of income you would like, assuming a net investment return of 6% p.a., inflation of 2.75% p.a. The tables below show how long your money will last in a range of scenarios and whether you are single or a couple. (in today’s dollars) for around 30 years, whereas the same $525,000, invested in the same manner, would only last 10 years without the Age Pension as a supplement. This means that $525,000 within super can provide a couple with an income of around $60,000 p.a. Related Article: Australian Retirement Ageĭue to these two prongs in Australia’s retirement system, our savings can last much longer than they ordinarily would, because not only do we receive tax free income and tax-free investment earnings throughout retirement, but this income can be supplemented by Age Pension payments. You need a calculator that includes the Age Pension and the concessional tax treatment of superannuation. Because of this, most generic calculators will understate how long your money will last in retirement. In Australia, we are fortunate to have the safety net of the Age Pension, together with the tax-effective retirement savings platform known as superannuation. Related article: Retirement Income Calculator How Long Will My Money Last in Retirement? You may find an excel sheet is useful to project this out over a number of years (remember to take inflation into account!). Savings amount + earnings rate – expenses – taxes = closing balance after year 1 (and starting balance of year 2).įor example, if I had $300,000 invested in a managed fund expected to earn 5% p.a. Simply use the following formula each year until your savings reach $0: Now, we can calculate how long your savings will last. So, if you are going to use this, realize that it is a mathematical exercise and the inputs that you choose and how you interpret the results are your own responsibility.īelow are some additional explanations that may help you use this calculator.Related article: Biggest Retirement Planning Mistakes To Avoid How Long Will My Money Last Calculation? ![]() The most important thing about this spreadsheet to understand is that future rates of return, inflation, salary, disasters, how long you'll live, and other life events can't be known for sure. Using the Retirement Calculator Spreadsheet The spreadsheet is still not ideal for that scenario (but it's better than it was). Update (): This calculator was not designed for the case where Current Age >= Age at Retirement (meaning no accumulation phase), but a few changes were made in version 1.1.0 to handle a scenario where Current Age = Age at Retirement. Update (): Fixed an error in the "Value of Other Income at Retirement" so that it more accurately predicts the amount of additional salary to save to reach zero at the end of the payout period. Update (): Improved labels and instructions for the Current Savings Contributions section and added a note above the Shortfall section to warn when the shortfall is negative. However, the corrected formula calculates the employer match as the Match % multiplied by the Employee contribution or the Max contribution (whichever is less). The old formula assumed the employer match was always maxed out. Update (7/23/18): Fixed a bug in the formula for Current Annual Contributions. Update (7/20/16): Added the ability to limit Other Retirement Income to a specific number of years (thanks to Ben Martinek). Update (5/5/16): Fixed a bug where the Retirement Income in the table (and chart) referenced inflation rather than the Annual Increase. I still consider this spreadsheet a work in progress, but I think it's finally at a point where people can try it out. Note (3/13/15): I put this spreadsheet together after receiving numerous requests for a spreadsheet that combined my 401(k) savings calculator with my retirement withdrawal calculator.
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