What is the Probability of Running Out of Money Calculator?
The Probability of Running Out of Money Calculator helps you understand how likely it is that your retirement savings could be exhausted during your lifetime. By modelling your pensions, investments, property income and spending across many possible market outcomes, it shows how robust your retirement plan really is.
This tool is designed for UK investors and retirees who want a clearer, more realistic view of retirement risk, rather than relying on a single average return assumption.
How the Calculator Works?
This calculator models your retirement year by year from your chosen retirement age to your target end age. It combines all your investment pots, including SIPPs, workplace pensions, ISAs and taxable accounts, with guaranteed income sources such as DB pensions, State Pension and buy-to-let property income.
You can run the model in two ways:
- Monte Carlo simulation, which generates thousands of possible market paths using realistic return and volatility assumptions
- Deterministic stress testing, which applies fixed return sequences such as poor early years or poor late years to highlight sequence of returns risk
The results show the probability that your money lasts for your full retirement, and the probability that it runs out before your chosen age.
All figures are shown in real terms, meaning today’s spending power after inflation.
Step One: Enter Your Retirement Assets and Income
Add your pension pots, ISAs, taxable investments, cash and any guaranteed income sources such as DB pensions, rental income and the State Pension.
Step Two: Set Your Spending and Time Horizon
Enter your planned retirement spending, retirement age and target end age. This defines the period during which the model tests your plan across.
Step Three: Review Probabilities and Stress Outcomes
See the probability that your money lasts your full retirement and the likelihood of running out early. Adjust spending, income or assumptions to improve resilience.
Probability of Running Out of Money Calculator
Also known as a Probability of Ruin Calculator in retirement planning.
Model your UK retirement drawdown plan across SIPPs, workplace pensions, ISAs, GIAs, DB schemes and buy to let property. See how likely you are to run out of money under different market paths.
Disclaimer: This calculator provides illustrative projections only and does not constitute financial advice. Investment returns, inflation and personal circumstances can vary significantly. Consider speaking with a qualified financial adviser before making major retirement decisions.
What does retirement mean to you?
Traditional retirement is broken. Understand how our calculator enables you to live a better life now vs later.
Retire from corporate work?
Use the tool to utilise how you can step away from the corporate world and live life on your own terms.
Work less, live more
See how part-time or project-based work can bridge your income gap while giving you more time for life.
Freedom through planning
Understand how your savings, spending and investments can work together to buy back your time.
Test-drive retirement early
Model scenarios that let you experience elements of retirement before fully stepping away.
What is the Probability of Running Out of Money Calculator?
It is a UK-specific retirement risk tool that uses probability modelling and stress testing to show how likely your savings are to last for your full retirement.
What does this calculator actually show?
It shows the share of simulated market paths in which your money lasts to the age you chose. That is not a forecast of what will happen to you, and it is not the chance your plan is true. It is a way of seeing how often this set of assumptions survives messy returns. Look at when any shortfall appears, not only the headline percentage.
Why is probability more useful than a single projection?
Real markets do not deliver smooth average returns. Sequence of returns, volatility and timing matter. Probability modelling reflects this uncertainty and gives a more realistic picture of risk.
What is Monte Carlo simulation?
Monte Carlo simulation generates thousands of possible future market paths using expected returns and volatility. Each path tests whether your money survives your full retirement.
What is deterministic stress testing?
Deterministic testing applies specific scenarios, such as poor returns early in retirement or prolonged low growth, to highlight vulnerabilities that averages can hide.
What investments does the calculator include?
It includes SIPPs, workplace pensions, ISAs, taxable accounts, cash and income from property. Guaranteed income, such as DB pensions and the State Pension are layered in separately.
Does this calculator include tax?
It works in real net terms. If tax meaningfully affects your plan, you can adjust spending or net income assumptions accordingly.
What probability should I aim for?
There is not a number to aim for. A high percentage can still hide paths that run out, and a lower one can be acceptable if you could cut the extras after a bad year. Use the result to compare versions of your plan, then look at the worst runs and whether essential spending is covered. Comfort comes from flexibility and backup income, not a target score.
How accurate are the results?
They are scenario-based estimates, not predictions. Their value lies in showing risk exposure and helping you make better decisions under uncertainty.
Why can a high success rate still hide poor outcomes?
A 90% success rate still means some simulated paths run out of money, while the successful paths can end with very different balances. Look at the worst results, the size of any shortfall and when it appears. The percentage on its own is only a starting point.
How does spending flexibility affect the probability?
Even small, temporary reductions after poor returns can improve outcomes because fewer investments are sold at depressed prices. Test a rule that protects essentials and adjusts only discretionary spending. A model that assumes you can halve the budget is not a realistic improvement.
Should property be treated as a rescue asset?
Only if you have a realistic way and time to use it. Downsizing or selling a rental property can strengthen the plan, but the sale price, tax, costs and timing are uncertain. Run the plan with and without the property sale so the same value is not counted twice.
How often should I rerun the probability?
At least annually and after major market moves, spending changes, retirement-date decisions or new pension information. Use the same core assumptions so changes in the result mean something. A probability calculated once at retirement is not a lifetime guarantee.
Is my information stored?
No, all tools run client-side, and nothing is saved.
Is this a replacement for financial advice?
No. It is a planning and risk-awareness tool, not regulated advice.
Trust and education
Certified Money First Aider®
These calculators are built by a Certified Money First Aider to help you think more clearly about money and time. Money First Aid® is about practical, non-judgemental support for financial wellbeing. The calculators can certainly help you make informed decisions, but they are not regulated financial advice.
Behind Retirement Calculators
Built from the questions I was asking myself
I'm Ryan, the person behind Retirement Calculators. I started the site after selling an online business and trying to understand what our pensions, ISAs, investments and property actually meant for the way we wanted to live.
The calculators are built around those real decisions: whether you could work less, retire earlier, spend more now or use your money differently. They will not give you a perfect answer, but they can make the trade-offs much easier to see.
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