Search
  • Samuel Rad

Determining How Long Your Savings Will Last in Retirement


One key component of planning for retirement is figuring out how low long your savings will last once you retire. Running out of money in retirement is a major concern for many investors, and justifiably so – nobody wants to outlive their income.


As a result, when drawing up your financial plan it makes sense to calculate how long the savings you expect to amass prior to retirement will last once you do retire. If the numbers fall short, and your savings don’t appear to be able to support your planned expenditures in retirement, you can use this information to make changes to your plan. These changes could involve setting aside more funds for retirement or otherwise altering your retirement plans.

For example, downsizing your living quarters or moving to a location with lower living expenses, among other options.


The risk of outliving your income is known as longevity risk, and as advances in health and nutrition have increased average lifespans, the risk of outliving your income has also grown.

While life expectancy tables can provide information about average expected lifespans for people your age, your lifespan may diverge significantly from the average, making their use problematic when trying to determine how long your savings will last in retirement.

Another factor that can make it difficult to figure out how long your savings will last in retirement is the difficulty that can accompany projecting investment returns. Your money will obviously last a lot longer in retirement if your investment returns or rate of interest are high, and the opposite if they are low.


These uncertainties make it advisable to err on the side of caution when estimating how long your retirement savings will last. Various online sources can be used to help in calculating the length of time your savings are expected to support you during retirement. After determining the rate of return you expect your savings to earn, a retirement savings withdrawal calculator can help you figure out the length of time your savings are expected to last at a given rate.


Another method of determining how long your savings might last in retirement is to readjust your withdrawal amount each year depending on your life expectancy and your portfolio value. This avoids the danger of sticking to a specified withdrawal percentage only to find that your investment returns have underperformed your expectations, causing you to exhaust your savings earlier than expected. A life expectancy calculator can be used to determine the amount you can withdraw on a yearly basis using this approach.


Schedule Your Free Financial Planning Session with Our Award Winning CFP

Samuel Rad is an award winning fee-based Financial Planner with Affluencer Financial Advisors in Los Angeles, California. Mr. Rad has multiple licenses in the investments, real estate, and insurance fields. He has spent a considerable amount of his career lecturing at universities and companies, on financial topics such as financial planningretirement planning, and estate planning.


He currently lectures at UCLA and West Los Angeles College.

Contact:

13340 W. Washington Blvd.

Los Angeles, CA 90066

Email: sam@affluencer.com

Phone: 310.935.4726

Samuel Rad is a top Financial Advisor Los Angeles
Rated 4.8 /5 based on 55 reviews

Samuel Rad is a fee based financial planner in Los Angeles, California. He does not provide investment decisions on behalf of clients; instead he provides comprehensive retirement advice and solutions, without encouraging people to buy products.

 

In fact, he does not manage securities nor is he affiliated with any investment or securities firm including any firm generates management fees based on the purchase or trade of stocks, bonds, or mutual funds. He simply provides clients with unbiased, independent, objective advice on their personal financial goals.

 

The word “investments” in this website refers to real estate, and fixed investments. Sam does not hold registrations with FINRA, SEC or CA State.

 © 2020 Samuel Rad  I  All rights reserved  I Web Design 

  • Facebook Twitter Samuel Rad Best Financial Advisor Los Angeles
  • Yelp Twitter Samuel Rad Best Financial Advisor Los Angeles
  • YouTube Twitter Samuel Rad Best Financial Advisor Los Angeles
  • LinkedIn Twitter Samuel Rad Best Financial Advisor Los Angeles
  • Twitter Samuel Rad Best Financial Advisor Los Angeles
  • Blog Samuel Rad