Longevity Risk & Survival Calculator
Risk Assessment
What Is Longevity Risk?
Longevity risk is the chance that you live longer than your money lasts.
It is not about market crashes or bad spending habits. It is about time. Even steady spending can drain a portfolio if retirement lasts 30 or 40 years.
This risk grows because:
- People are living longer
- Healthcare costs rise with age
- Inflation slowly eats purchasing power
- Retirement income is often fixed
A longevity risk calculator puts numbers around this problem.
What This Longevity Risk Calculator Does
This calculator combines life expectancy data with financial projections.
In simple terms, it does four things:
- Estimates how long you are likely to live
- Projects how long your savings will last
- Finds the age when money may run out
- Calculates the chance you are still alive at that age
The result is a risk level that is easy to understand.
Key Inputs Explained (Plain English)
1. Age
Your current age sets the starting point for both survival and financial projections.
2. Gender
The calculator uses official mortality tables, which show that men and women have different life expectancy patterns.
3. Health Status
Health shifts the odds:
- Excellent health assumes you live about three years longer
- Poor health assumes about three years less
- Average uses standard life tables
This adjustment moves the entire mortality curve, not just one age.
4. Total Savings
This is the amount available to fund future spending. Investments, cash, and retirement accounts are typically included.
5. Annual Net Spend
This is what you withdraw each year after guaranteed income like Social Security or pensions.
If your expenses are $60,000 and Social Security covers $20,000, your net spend is $40,000.
6. Investment Return
This is the average annual return you expect on your portfolio. The calculator assumes it stays constant.
7. Inflation Rate
Inflation increases your spending every year. Even modest inflation matters over long periods.
How the Calculator Works Behind the Scenes
Step 1: Survival Probabilities
The calculator uses official life tables that track how many people survive to each age.
From this, it calculates probabilities like:
- Chance of living to 85
- Chance of living to 90
- Chance of living to 95
- Chance of living to 100
These numbers are conditional on your current age.
Step 2: Financial Projection
Each year, the calculator:
- Grows your balance by the investment return
- Subtracts your annual spending
- Increases spending by inflation
This repeats until:
- Your balance reaches zero, or
- Age 110 is reached
The age where savings hit zero is called the ruin age.
Step 3: Longevity Risk Calculation
If money runs out at age 88, the calculator asks:
What is the probability that you are still alive at age 88?
That probability is your longevity risk.
If your money never runs out, longevity risk is near zero.
Understanding the Results
Longevity Risk Level
You will see one of these categories:
- Very Low Risk
Money is projected to last beyond age 110. - Low Risk
There is a small chance you outlive your money. - Moderate Risk
A meaningful chance exists. Planning changes may be needed. - Critical Risk
There is a high probability of being alive after savings are depleted.
These labels are based on survival probability at the ruin age.
Money Runs Out at Age
This tells you when the portfolio is projected to hit zero, assuming all inputs stay the same.
It is not a prediction. It is a planning signal.
Survival Probability Table
This section answers common questions directly:
- What are my odds of reaching 85?
- What about 90 or 95?
- Is living to 100 realistic?
These numbers help frame retirement length, not fear.
Why This Calculator Is Useful
Most retirement tools focus only on:
- Safe withdrawal rates
- Portfolio growth
- Average life expectancy
This calculator focuses on something more practical:
The overlap between life and money.
It highlights risks that average projections often hide.
Important Assumptions to Understand
This calculator keeps things simple on purpose.
It assumes:
- Constant investment returns
- Constant inflation
- No market volatility
- No unexpected expenses
- No tax changes
Real life is messier. That is why the results should guide decisions, not replace professional advice.
How to Use the Results Wisely
If your risk is high or moderate, consider:
- Reducing annual spending
- Delaying retirement
- Increasing guaranteed income
- Adjusting investment strategy
- Planning for long-term care costs
Even small changes can shift the outcome by several years.
Who Should Use a Longevity Risk Calculator?
This tool is especially useful for:
- Pre-retirees aged 50+
- Retirees drawing from investments
- Couples planning joint retirement
- Advisors explaining longevity risk visually
It is also valuable for anyone who wants clarity without complex models.