Your real retirement date depends on the gap between your expected retirement spending and your guaranteed retirement income. Calculating this retirement income gap can help determine whether your investment portfolio is capable of supporting the retirement you want.
Calculate Your Retirement Income Gap
Start by subtracting your annual guaranteed income from your estimated annual retirement expenses.
Annual retirement spending − guaranteed income = retirement income gap
Guaranteed income may include Social Security benefits, pensions, annuities and reliable net rental income. The amount remaining after this calculation is what your retirement portfolio must provide each year.
Determine Your Portfolio Withdrawal Rate
Next, divide your annual retirement income gap by the total value of your income-producing retirement assets.
Annual income gap ÷ retirement portfolio value = withdrawal rate
Your withdrawal rate helps show whether your retirement savings may last for the number of years you expect to rely on them. A withdrawal rate that appears sustainable for a 20-year retirement may create a greater risk of running out of money when the same portfolio must support 30 years or longer.
Compare Different Retirement Dates
The final question is not simply, “Can I retire?” It is how your financial position changes when you retire now compared with retiring in two or five years.
Working longer may provide several financial advantages, including additional retirement savings, more time for investment growth, fewer years of portfolio withdrawals and a potentially larger Social Security benefit.
However, these advantages are often strongest during the earlier additional working years. Eventually, you may reach a point where working one more year makes only a small difference to your long-term retirement security.
That point can help identify your realistic target retirement date.
If this is your first time with me, I’m Elizabeth.
• I help women navigate taking over the finances after widowed, divorce or illness
• I help people comfortably retire 10 years early
• We provide sustainable, predictable income in retirement
• $200 million and thousands trust us with their retirement planning (as of 8/1/2026)
• Book an intro call. https://calendly.com/nova-wealth-intro/novawealthintro
• Join the Second Half. https://retirenova.com/resources
