You may have set up an investment account that allows you to take money out on a regularly and automatically basis. Systematic withdrawals can be an important way to manage money in your retirement. However, it is important to determine how long your money will last with this withdrawal plan. You’ve worked hard to accumulate your savings; use our systematic withdrawal plan calculator to determine how long those funds will last given regular withdrawals.
Understanding How Long Your Account Will Last
Use our calculator to find out how long your account will last when you use systemic withdrawals to generate income. If you save money for retirement or choose to take out money through systemic withdrawals to enjoy more income now, understanding how long your investments will last this way is important for a few reasons:
- It helps you understand whether you need to be concerned about retirement. Have you saved enough for retirement? Will your savings last longer than you do? Making sure you have enough for your senior years is an important part of planning for the future. Understanding how long systemic withdrawals will allow you to keep earning income is important for long-term financial planning and for your retirement plan.
- It helps you understand whether systemic withdrawals are right for you. When you find out how long your investments will last, you can determine whether systemic withdrawals are right for you or whether you should switch to annuities or withdraw once a year and place your money in a money market account. If you find that your systemic withdrawals would not allow your investments to last long enough, you may also take other steps with a financial planner to ensure your money meets your needs.
- It helps you keep alert to the market. When the market is doing poorly, your investments may be worth less, meaning you will go through your investments and savings more quickly if you’re using systemic withdrawals. Seeing how long your withdrawals will last in the current market allows you to make long-term plans, so you don’t just drain your investments.
- It helps you adjust your systemic withdrawals appropriately. Perhaps you want to earn a little extra money so you can travel the world or so you don’t have to work as hard right now. Understanding how long your withdrawals will last allows you to determine whether you should reduce the amount you are removing every month or whether you should allocate your withdrawals differently — for example, so they come out of an aggressive growth fund instead of savings. This ensures you get your money to last as long as possible.
Once you have saved up money and have investments, you may want to enjoy monthly income from what you have earned. Understanding how systematic withdrawals can affect your taxes, your finances and retirement is key. Money Help Center helps you understand how long your investments will last so you can make smart decisions now and in the future. Our calculators come with no bias because we are not associated with any third party, and are free to use and don’t require you to submit your contact information or e-mail, so your information stays confidential.