How to Calculate How Long Money Will Last in Retirement

48%. That's the share of workers who have never estimated how much they'll need each month in retirement, according to the EBRI/Greenwald Retirement Confidence Survey 2025. Close to half are guessing. If you're trying to work out how to calculate how long money will last in retirement, you're already doing better than they are. This guide covers the quick math, the spreadsheet version, and the more honest version: a probability, not a single date.

The quick answer

The simplest version is one line of division:

Savings ÷ yearly spending from savings = years your money lasts (with no growth)

Say you have $600,000 and you plan to withdraw $36,000 a year. That works out to about 16.7 years. If your portfolio earns nothing beyond inflation, that's your runway.

That's a floor, not a forecast. Invested money keeps growing while you spend it, and prices keep rising. So the next step is to add both.

How to calculate how long money will last in retirement, step by step

Most calculators, including SmartAsset's and Practical Money Skills', use the same core inputs:

1. Your current balance. Everything you'll draw on: 401(k)s, IRAs, taxable accounts.
2. Your annual spending. What you'll actually spend, not what you hope to spend.
3. Other income. Social Security, a pension, part-time work. Take this away from spending to get the amount your savings has to cover.
4. Expected return. What the portfolio earns each year.
5. Inflation. How fast your costs go up.

A shortcut that saves effort: use a real return, meaning your expected return minus inflation. That keeps everything in today's dollars, so your withdrawal can stay the same in the formula.

The spreadsheet method (NPER)

Google Sheets and Excel both have a function for this. It's called NPER, short for "number of periods."

=NPER(real_return, -annual_withdrawal, savings)

Using the same example, a hypothetical 2% real return, $36,000 a year and $600,000 saved:

=NPER(0.02, -36000, 600000) → about 20.5 years

So a modest 2% real return adds almost four years compared with simple division. Change the return to 3% or 1% and watch how far the answer moves. That sensitivity is the whole problem.

Why one number isn't enough

The NPER answer assumes your portfolio earns the same return every single year. Markets don't work that way.

Order matters. Two retirees can get the same average return over 30 years and still end up in very different places. If the bad years come early, while you're withdrawing from a portfolio that just fell, you sell more shares at low prices. Those shares aren't around for the recovery. This is called sequence-of-returns risk.

One illustrative example from Acadifi makes the point. A single average-return projection said a plan was fine. Run through 10,000 simulated trials, the same plan had an 18% chance of running out of money.

A straight-line projection can't see that 18%. It only ever sees one path.

What a Monte Carlo success rate tells you

A Monte Carlo simulation sounds technical. The idea is simple.

Rather than one steady return, it runs your plan through hundreds or thousands of random market paths. Some start with a crash, some with a boom, and most land somewhere in between. Then it counts how many of those paths still have money at the end.

That count is your success rate. As EP Wealth explains, an 85% success rate means 850 out of 1,000 simulated futures still had money left.

That changes the question you're asking. "How many years will my money last?" becomes "How likely is it that my money outlasts me?" The second one is the one you actually care about.

It's also how the big research on withdrawal rates works. Morningstar's 2025 research puts the safe starting withdrawal rate at 3.9%. That figure comes from asking whether money is still there in 90% of simulated outcomes over a 30-year retirement, not from an average return (Morningstar, The State of Retirement Income 2025, December 2025). Boldin reports this is up from 3.7% the year before, and that portfolios with 30% to 50% in stocks supported the highest rates.

In plain terms, a $600,000 portfolio at 3.9% supports a starting withdrawal of about $23,400 a year, adjusted for inflation after that. That's well below the $36,000 in our earlier example. Same savings, very different picture.

The assumptions that move your answer most

Every method depends on its inputs. Here's how much a few of them change the "safe" starting rate, according to published research:

Bengen created the original 4% rule. His newer, higher number comes partly from testing against past market history, while Morningstar uses forward-looking estimates. Neither is wrong. They're answering slightly different questions, which is why you should know which assumptions sit behind whatever number you rely on.

Lifespan: plan longer than feels natural

Most people underestimate this one. Social Security's own planning guidance says about one in three 65-year-olds may live to at least 90 (Social Security Administration, Retirement Information for Medicare Beneficiaries, 2026). A plan that stops at 85 is quietly betting against a third of retirees.

For couples, the horizon gets longer. Based on the American Academy of Actuaries' Longevity Illustrator, a healthy, non-smoking 65-year-old couple has nearly a 75% chance that at least one of them reaches 90 (Advisorpedia). Individually, Kiplinger puts the odds at about 25% for a 65-year-old man and 37% for a woman. Estimates vary with health assumptions. The lesson doesn't: plan for whichever spouse lives longer, not for the average.

That's why the plan you build with Monte Climb runs to 95 by default, and you can push it further.

Health care: a line item, not a rounding error

Fidelity estimates that a 65-year-old retiring in 2025 will spend $172,500 on Medicare premiums, deductibles and prescriptions over retirement. That leaves out long-term care entirely (Fidelity Investments, 2025 Retiree Health Care Cost Estimate, July 2025).

If your spending number doesn't include health care, your answer is too optimistic. Our engine charges Medicare premiums and income-based surcharges year by year, not as one flat guess.

Spending flexibility

The gap between 3.9% and roughly 6% in the table comes down to one thing: whether you're willing to cut back in bad years. If you could trim travel or delay a big purchase after a market drop, your plan can probably support more at the start. If your budget is fixed, plan around the lower number.

What a success rate doesn't tell you

A success rate beats a single number. It's still not the whole story.

• It doesn't show how close the "successes" came. A future that ends with $5 left counts the same as one that ends with $500,000.
• It doesn't stay fixed. As the Best Interest blog discusses, drawing on Big ERN's research on conditional success rates, your odds after a rough first few years can look very different from your odds on day one. That's a reason to rerun your numbers regularly, not to set a plan once and forget it.
• It depends on its assumptions. Optimistic return estimates make the odds look better. That's why it helps to know what the model assumes.

So treat a success rate as a probability, not a promise. It's a way to compare choices, such as retiring at 62 vs. 65 or spending $4,000 vs. $4,500 a month. It can't guarantee an outcome.

A five-step checklist

1. Find your real spending number. Include health care.
2. Subtract guaranteed income. Social Security, pensions.
3. Do the quick math. Simple division, then NPER with a conservative real return.
4. Compare against a researched withdrawal rate. Is your rate near 3.9%, or well above it?
5. Run a Monte Carlo test to at least 90, ideally 95. Then stress-test it. Try a bad first few years, higher health costs, a longer life.

Run your own numbers

Three numbers. Your age, what you've saved, and what you spend each month. Enter them on the Monte Climb retirement calculator and we'll run them through 1,000 simulated futures and show you how many stay funded. It runs in your browser, and nothing is saved until you say so.

Want to go further? Ask William, our AI planner, questions like "Am I on track?" or "Can I retire at 62?" He shows his work. If you want the full app, there's a 7-day trial for $1.

Planning software, not advice. A clearer picture of your odds, though, is a good place to start.

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Frequently asked questions

What is the simplest way to calculate how long my retirement savings will last?

Divide your savings by the amount you'll withdraw each year. For example, $600,000 ÷ $36,000 is about 16.7 years, assuming no growth. To include investment returns and inflation, use the NPER function in a spreadsheet with an inflation-adjusted (real) return.

Is the 4% rule still safe?

Morningstar's 2025 research puts the safe starting withdrawal rate at 3.9% for fixed, inflation-adjusted spending over 30 years, judged by whether money lasts in 90% of simulated outcomes. William Bengen, who created the 4% rule, now says 4.7% is the worst-case safe maximum based on historical returns. The right number depends on your assumptions and how flexible your spending is.

What does a Monte Carlo success rate mean?

A Monte Carlo simulation runs your plan through many random market paths and counts how many still have money at the end. An 85% success rate means 850 out of 1,000 simulated futures stayed funded. It's a probability, not a guarantee.

What age should I plan my retirement savings to last until?

Plan longer than average life expectancy. The Social Security Administration says about one in three 65-year-olds may live to 90 or beyond, and a healthy 65-year-old couple has nearly a 75% chance that at least one spouse reaches 90. Many planners use 95 as a default.

How much should I budget for health care in retirement?

Fidelity's 2025 estimate is $172,500 for a 65-year-old retiring that year, covering Medicare premiums, deductibles and prescriptions. It doesn't include long-term care, so leave room for that separately.