Are You On Track to Retire?

The Model

This calculator uses a two-phase projection model. During the accumulation phase (your working years), your portfolio grows each year by applying the expected return rate and adding your annual contribution. During the distribution phase (retirement), your portfolio is reduced each year by your annual spending while still earning a return on the remaining balance.

Key Calculations

• Accumulation: Each year, Balance = Previous Balance × (1 + Return Rate) + Annual Contribution
• Distribution: Each year, Balance = Previous Balance × (1 + Distribution Rate) − Annual Spending
• Distribution rate: Set at 60% of the accumulation return rate to reflect a more conservative retirement allocation

Assumptions

• Returns are constant each year (no market volatility)
• Contributions and spending are fixed (no inflation adjustment)
• No taxes, fees, or transaction costs are included
• Retirement spending begins immediately at the retirement age
• The distribution return rate is automatically reduced to 60% of the growth rate to approximate a more conservative retirement portfolio

Interpreting Your Results

• Blue bars show your portfolio during the accumulation phase
• Green bars show your portfolio during retirement withdrawals
• Amber bars indicate your portfolio has been depleted
• “On Track” means your portfolio sustains through your life expectancy
• If the portfolio runs out, the calculator shows at what age and the shortfall in years

Tips for Using This Tool

• Try adjusting your retirement age by a year or two — small changes can have a large impact
• Experiment with different spending levels to find the boundary where your plan works
• A 7% expected return approximates a balanced stock/bond portfolio before inflation
• Consider running multiple scenarios: optimistic (8-9%), moderate (6-7%), and conservative (4-5%)
• Remember that real-world returns are volatile — a constant-return model overstates certainty