How Much Do I Need to Retire?

The question most often asked by clients and investors is, how long will my money last?

The table below can be used as a guide to help answer that question.

In the table we have identified some key milestone investment balances and matched those against a range of income drawdown’s.

Importantly, we have assumed the portfolio is invested in accordance with a ‘Balanced’ profile.

We have assumed the investment portfolio achieves a return of 7.5% per annum comprised of 4% income and 3.5% growth, the historical average for a ‘Balanced’ investor.

Tax has been ignored.Inflation is assumed at 3% per annum and therefore the income drawdown is increased by inflation each year.

Starting Balance	$150,000	$250,000	$350,000	$450,000	$500,000	$650,000
$30,000 pa	6.5 years	10.5 years	16 years	24.5 years	30 years	Lifetime
$40,000 pa	5.5 years	7.5 years	11 years	15.5 years	18.5 years	30.5 years
$50,000 pa	4 years	6 years	8.5 years	11.5 years	13.5 years	19.5 years
$55,000 pa	3.5 years	5.5 years	7.5 years	10.5 years	12 years	16.5 years
$60,000 pa	2.5 years	4.5 years	7 years	9 years	10.5 years	15 years
$75,000 pa	2 years	3.5 years	3.5 years	7.5 years	8.5 years	11 years

Note 1: The result has been rounded to the nearest whole or half year.

Note 2: Pension income indexed at 3% per annum.

Warning: The above table has been provided as a guide. You should discuss your situation with your Adviser.

Grant Hodgins - Director of Advantage One

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