Retirement Income Calculator
What your portfolio pays in retirement.
Calculate retirement income from portfolio. See year-1, year-30, and cumulative income with inflation. Enter portfolio value and see the result instantly.
What this tool does
This tool calculates retirement income from a portfolio using safe withdrawal rates with inflation adjustment. Enter portfolio value, safe withdrawal rate, years in retirement, and annual inflation rate. Shows year 1 income, monthly, final year income, and cumulative total drawn.
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Formula Used
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Disclaimer
Results are estimates for educational purposes only. They do not constitute financial advice. Consult a qualified professional before making financial decisions.
Once you have a retirement portfolio, the question becomes: how much income can you safely draw? The 4% rule suggests 40,000 annually per 1 million. With inflation adjustments, the figure grows each year. This calculator shows year-1 income and inflation-adjusted projections.
1,000,000 portfolio at 4% withdrawal with 2.5% inflation over 30 years: year 1 income 40,000 (3,333 monthly), year 30 income 81,800, cumulative 1.86 million drawn over retirement. Higher portfolio = higher income directly.
The calculation assumes the 4% rule holds - portfolio sustains 30+ years. For longer retirements (early retirement, 40+ years), reduce to 3.25-3.5% for more safety. For shorter retirement (late retirement or high pension income), 5% may be sustainable. Match withdrawal rate to horizon and risk appetite.
Run it with sensible defaults
Using portfolio value of 1,000,000, safe withdrawal rate of 4%, retirement years of 30, annual inflation of 2.5%, the calculation works out to 40,000.00. Nudge the inputs toward your own situation and the output recalculates instantly. The defaults are meant as a starting point, not a recommendation.
The levers in this calculation
The inputs — Portfolio Value, Safe Withdrawal Rate, Retirement Years, and Annual Inflation — do not pull with equal force. The rate and the time horizon usually dominate — compounding means a small change in either reshapes the final figure more than a similar shift in contribution size. Test this by doubling one input at a time.
How the math works
Year 1 income = portfolio × withdrawal rate. Subsequent years grow at inflation. Cumulative = sum of inflated annual incomes. The working is transparent — you can verify every step yourself in the formula section below. No black box, no opaque "proprietary model".
Why the number matters
Saving without a target is like driving without a destination — you'll make progress, but you won't know when you've arrived. This tool gives you a concrete figure to work toward, which is the first step in turning a vague intention into an actual plan.
What this doesn't capture
The calculation assumes a steady savings rate and a stable interest rate. Real saving journeys include emergencies, windfalls, and rate changes — especially in easy-access products. The figure is a direction of travel, not a guarantee.
£1,000,000 £ at 4% over 30 yearsyrs with 2.5% inflation = $40,000.00.
Inputs
This example uses typical values for illustration. Adjust the inputs above to match a specific situation and see how the result changes.
Sources & Methodology
Methodology
Year 1 income = portfolio × withdrawal rate. Subsequent years grow at inflation. Cumulative = sum of inflated annual incomes.
References
Frequently Asked Questions
Does 4% really work?
What about sequence of returns risk?
Is cumulative income the right planning figure?
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