How Long Will My Money Last (And Why)?

Exact Answer: At Least 30 Years

Figuring out exactly how many years one’s money will last is not an exact science. Many unforeseen factors can influence this decision like inflation rate, return on investment, sudden expenses, etc. All these factors can directly or indirectly dramatically affect the longevity of one’s money in savings.

Several calculators help people comprehend how long their money is going to last based on their annual investment returns percentage, estimated tax rate, the amount present in savings among others.

A calculator can help people to deduce the estimated years their money can last based on the savings they keep aside for their future. However, there is a rule of thumb on how to withdraw and utilize one’s money to ensure that it lasts as long as one requires it, no matter what happens in their life.

As per the 4% rule of withdrawal, if one invests at least 50% of the money in stocks and rests in bonds, one has a strong likelihood of being able to withdraw an inflation-adjusted 4% money every year for 30 years or even longer, depending on the investment return over the years. The 4% rule is simple and by following it religiously, one can probably make his money last for at least 30 years.

How Long Will My Money Last

How Long Will My Money Last?

Total Wealth AvailableReturn Generated Per YearYearly InflationMonthly Expenses Required (Pension)Longevity
20,00,00010%5%10,000Approx. 30 years
15,00,00010%5%10,000Approx. 18 years
10,00,00010%5%10,000Approx. 10 years

One’s money is unlikely to last the same number of years that most withdrawal calculators tell. However, one can get a rough idea about it. When people ask how long will one’s money last, they expect a simple answer like 25 years, etc. However, the reality is very different and thus depends on many factors.

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One can take the help of probabilities to tell how long one’s money will last. One must take into consideration how much risk is someone comfortable with, what investment and withdrawal strategy one adopts to ensure the longevity of his money.

The 4% thumb rule can help solve the problem and conclude a solution. Thus, as per this rule, if one withdraws 4% of their portfolio each year after retirement, the cash can last for at least 30 years. Following it does not guarantee that one will not run short of funds, but it might work depending upon the performance of one’s investments.

Why Will My Money Last This Long?

The U.S.-based financial advisor William. P. Bengen first developed the 4% withdrawal rate. He analyzed the historical data of the stock and bond market. He later concluded that if an individual whose family withdraws 4% every year from the portfolio after retirement, the corpus of money will last for a minimum of 30 years, irrespective of market condition

However, this thumb rule will not work every time. For example, a severe market downturn can significantly erode the value of equities in a person’s portfolio. This rule might not work if the retiree is not loyal to the rule every year.

One needs to know how long can one cover his expenses before his savings are exhausted. Therefore, understanding one’s expenses is the first step for calculating how long can the money last. While calculating expenses, one needs to include each and everything one’s saving is expected to cover, such as groceries, medical bills, loan repayments, taxes, traveling exps, etc. One also needs to estimate the expected return on his investments and savings.

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One can make his hard-earned money last longer by working longer as it prolongs the duration in which contribution is made to your account, either through an employer or by personal contributions. Another way to make the money last long is by reducing expenses. One can avoid spending too much on superfluous wants. Meeting a financial planner is another option to professionally plan one’s financial goals. The benefits of advice from a good financial planner often outweigh the cost.


The answer to the question of how long will one’s money has massive implications during the time of one’s retirement or during the period when one has lost his job

Almost every person is curious to know how long will his money last. There is no simple and exact answer to this question, but if one follows the 4% rule, he can make his money last at least 30 years, provided, he religiously abides by the rule. The 4% rule has proved to be the safe withdrawal rate during some of the worst market downturns in history.

The only thing one is certain about is the amount of money one starts with. All other variables that can influence the duration of the longevity of money are estimates over which nobody has any control. Thus, there cannot be an exact answer to how long will one’s money last to sufficiently cover all his expenses.