Pension calculator

theGrinch

Can someone recommend a pension calculator to see how long you pot will last where you keep invested but drawing down too?

ColdIron

HL have one
https://www.hl.co.uk/pensions/drawdown/calculator

GDB2222

There's a problem with drawdown, namely how long will you live? I'm 65, and the HL calculator summarises that nicely:
"Males born in 1953 have an estimated life expectancy of 86 and about a 1 in 10 chance of living to 100."

So, what do I do? Aim to use up the fund by the time I am 86, and then have a 1:10 chance of living another 14+ years without any income?

Or do I aim to make the fund last until I am 100+, and live rather frugally. Remember that the life expectancy of 86 is an average, so I have a 50/50 chance of dying before then.

kidmugsy

GDB2222 wrote: »

There's a problem with drawdown, namely how long will you live? I'm 65, and the HL calculator summarises that nicely:
"Males born in 1953 have an estimated life expectancy of 86 and about a 1 in 10 chance of living to 100."

So, what do I do? Aim to use up the fund by the time I am 86, and then have a 1:10 chance of living another 14+ years without any income?

Or do I aim to make the fund last until I am 100+, and live rather frugally. Remember that the life expectancy of 86 is an average, so I have a 50/50 chance of dying before then.

In economics free lunches are rare. If people opt for drawdown rather than annuities one of the costs is that they will keep a large chunk of funds aside for "just in case there's a market collapse" or "just in case I live to 100". Naturally this reduces the income they can confidently take. And it doesn't even assure them of the income they'd like. Nor does it assure them that there will be a pot of surplus capital at death for a widow or children or grandchildren.

jsinc

Not calculators but -

Going through the steps here to start building your own financial/retirement planning spreadsheet is a good use of time: https://www.youtube.com/watch?v=1LUIQa5hgMg

The paper linked here is worth a read: http://www.morningstar.co.uk/uk/news/149651/how-much-can-you-safely-withdraw-annually-from-your-pension-pot.aspx

theGrinch

I was using this one today.

https://pensionsandsavings.com/pension_run_out_calculator/

redux

That's a bit basic, and doesn't account for inflation

Try https://www.thecalculatorsite.com/finance/calculators/savings-calculators.php

AndyAdams

jsinc wrote: »

Not calculators but -

Going through the steps here to start building your own financial/retirement planning spreadsheet is a good use of time: https://www.youtube.com/watch?v=1LUIQa5hgMg

The paper linked here is worth a read: http://www.morningstar.co.uk/uk/news/149651/how-much-can-you-safely-withdraw-annually-from-your-pension-pot.aspx

So a safe withdrawal rate of between 2.5% and 3% ?

jsinc

AndyAdams wrote: »

So a safe withdrawal rate of between 2.5% and 3% ?

Opinions differ - defining 'safe', time period, accounting for fees, whether conclusions of mostly US based research (markets and residency) are appropriate for non-US based investors.

There's an interesting chart on page 12 that summarises withdrawal rates by portfolios, time period and target success rate - according to allocation of equities. Note that the research assumes a 1% portfolio fee, so if your fees are lower than 1% their relevant withdrawal rate would be higher, and vice versa.

BJL55

If you like to play with Excel, here's one I created:

http://mcbrian.uk/for_post/Drawdown Calc for play.xlsx

Feel free to use and share.

Random47

Try this: http://www.tpt.org.uk/calculator-dc

Is easy and lets you change flexibility with any DB, salary, investment return, change or delay draw down etc.