Do You Need Retirement Income Projections?
Planning for retirement isn’t just about saving it’s about knowing how much income you’ll have once you stop working. That’s where retirement income projections come in. These forecasts help you estimate how much money you’ll be able to withdraw each year from your retirement accounts and whether that amount will support your lifestyle.
In this article, we’ll break down what retirement income projections are, why they matter, how to get them, and how to tell if you’re on track.
What Are Retirement Income Projections?
A retirement income projection estimates the amount of income you can expect to receive during retirement based on your savings, investments, Social Security, pensions, and other sources. It factors in variables like:
- Current savings and contributions
- Expected rate of return
- Inflation
- Life expectancy
- Retirement age
- Spending needs
The goal? To answer the big question: “Will I have enough money to last through retirement?”
Why Retirement Income Projections Matter
1. Clarity on How Much You Need to Save
Income projections show you the gap between what you’ll need and what you’re on track to have. This clarity can guide smarter decisions around saving, investing, or delaying retirement.
2. Better Investment and Withdrawal Planning
Once you know how much you can safely withdraw, you can align your asset allocation and retirement portfolio more effectively.
3. Peace of Mind
Knowing your numbers provides emotional relief and reduces anxiety around the unknowns of retirement.
4. Helps Avoid Overspending or Underspending
Many retirees either overspend and run out early or underspend and miss out on experiences. Projections help balance your spending with sustainability.
What’s Included in a Good Retirement Income Projection?
A comprehensive projection should account for:
- Estimated Social Security benefits
- Pension income (if any)
- Withdrawals from IRAs, 401(k)s, or brokerage accounts
- Required Minimum Distributions (RMDs)
- Investment growth assumptions
- Healthcare expenses and inflation
- Taxes on withdrawals
How to Get a Retirement Income Projection
1. Online Calculators (Free and DIY)
Many platforms offer basic projections with sliders and graphs:
Tip: Use conservative assumptions such as a 5–6% return and 3% inflation — to stay realistic.
2. Robo-Advisors with Planning Tools
Platforms like Betterment, Wealthfront, and Personal Capital (Empower) offer built-in retirement projection tools as part of their dashboard.
These typically sync with your bank, IRA, and 401(k) accounts to create a live forecast.
3. Working with a Financial Advisor
For complex scenarios — like high income, pensions, rental properties, or tax strategy a CFP® can provide personalized projections and scenario modeling.
Most advisors use tools like MoneyGuidePro, eMoney Advisor, or RightCapital, which provide deeper analysis than free online tools.
Are You on Track?
You’re on track if your projected income:
- Covers 80–100% of your projected retirement expenses
- Sustains through age 90+ (or longer, to be safe)
- Remains stable during bear markets or inflation spikes
Red Flags You Might Be Behind:
- Large income shortfall
- Projections that end before age 85
- Withdrawal rates above 5–6%
- No buffer for healthcare or long-term care
How to Improve Your Projection
- Increase savings now
- Delay retirement or Social Security
- Refine your budget
- Reduce unnecessary debt
- Diversify your income sources (e.g., annuities, part-time work, rental income)
Final Word: Don’t Guess — Project
Whether you’re 10 years from retirement or already in it, knowing where you stand is powerful. Retirement income projections remove guesswork and empower you to make informed, confident decisions about your future.
Ready to take the next step?
Safe Withdrawal Rates for 2025 Retirees — Learn how much you can safely take out of your accounts each year without running out of money.
