Annex Wealth Management: How Long Will My Money Last? in Retirement

How the estimate treats your savings

The calculator begins with the savings amount you enter. In year one, it applies your expected annual return, then subtracts the first-year withdrawal. Each later year raises that withdrawal by the inflation percentage you entered before taking it from the balance.

That order matters. A $60,000 first-year withdrawal raised by 2.5% becomes $61,500 the next year, then $63,038 the year after that. The calculator repeats the same process until the balance reaches zero or the calculation ends.

The example below uses a hypothetical $1,200,000 starting balance, a 5% annual return, a $60,000 first withdrawal and a 2.5% yearly raise. The last year reaches zero under those inputs. It is a useful stress point, not a promise about an actual retirement.

Read the result against your spending plan

A long estimate is useful only if the income draw covers the life you actually intend to fund. Start with monthly spending: housing, staff or practice obligations, student debt, insurance, travel and taxes. A large portfolio can still produce a short estimate when the planned spending rate is high.

For a physician or dentist who saved late, the first-year withdrawal rate deserves close attention. Divide the first withdrawal by savings. In the example, $60,000 divided by $1,200,000 equals 5%. That is the number to test against your spending plan, not the portfolio balance alone.

A simple rule: if the first-year withdrawal exceeds 5% of savings, run a second illustration with lower spending, more savings or a later retirement date. That threshold is a planning prompt, not a universal safe limit. Student loans, a practice sale and taxes can change the amount your portfolio must supply.

• Compare income with monthly spending
• Test a lower return
• Include practice-sale uncertainty

What the calculator cannot see

The calculator uses one return every year. Real markets do not. A strong average return can still conceal a difficult first few years, when large income draws force more shares to be sold at depressed prices. It also leaves out taxes, Social Security, required minimum distributions, healthcare costs and changes in your spending.

Annex Wealth Management starts with the cash flow the portfolio must fund. Before suggesting an investment change, the team can examine the monthly spending plan, account types, debt schedule and practice questions together. A physician's taxable account may serve a different purpose from a dentist's traditional IRA, especially when taxes or a future practice sale affect the timing of income draws.

The written agreement sets out fees before any work starts. A real plan also has to say what happens when the market falls, which account supplies cash and how a practice decision changes the amount the portfolio needs to provide. The calculator cannot make those choices for you.

• Monthly spending plan
• Taxable and retirement accounts
• Practice value and debt

Check the return before trusting the number

The input that most easily flatters the result is the expected annual return. A higher return makes the balance appear to last longer, while a lower return shortens the estimate. The same problem occurs when the first withdrawal excludes taxes, insurance or irregular practice expenses.

Run the calculator with several return and inflation combinations, then compare each first-year income draw with your actual monthly spending plan. If the answer changes sharply, the result is sensitive, and it deserves a closer review rather than a confident conclusion.

• Overstate expected return
• Understate annual spending
• Forget inflation raises