Pension Drawdown Calculator
Calculate how long your pension pot will last with a given annual withdrawal, or find the maximum sustainable drawdown amount.
How Pension Drawdown Calculator works
Drawdown calculation
Duration: months = −ln(1 − r × PV ÷ PMT) ÷ ln(1 + r). Maximum withdrawal: PMT = PV × r ÷ [1 − (1 + r)^(−n)]. Both use the monthly rate (annual rate ÷ 12). If withdrawal ≤ monthly interest on the pot, the pot lasts indefinitely.
Sequence of returns risk
This calculator assumes a constant growth rate. In reality, investment returns vary year to year. Sequence of returns risk means that poor returns in early retirement can deplete a pot much faster than average returns suggest — even if long-run average returns are the same.
Sustainable withdrawal rates
The 4% rule is a widely used benchmark for a 30-year retirement. A 3.3% rate is sometimes used for a 40-year retirement. In low-return environments, some researchers suggest 3–3.5% is safer. Your age at retirement, asset allocation, and flexibility to reduce withdrawals all affect the sustainable rate.
Frequently asked questions
How long will £300,000 last in drawdown?
At 5% growth and £18,000/year withdrawal: approximately 36 years. At £24,000/year: approximately 22 years. At 5% growth and £15,000/year withdrawal (5%): the pot grows and lasts indefinitely.
What is flexible drawdown?
Flexible drawdown (flexi-access drawdown) allows you to take any amount from your pension at any time (not just the 25% tax-free, but any amount). Once you access flexible drawdown, the Money Purchase Annual Allowance (MPAA) of £10,000 applies to future pension contributions.
Should I take drawdown or an annuity?
Drawdown offers flexibility and upside potential; annuities offer certainty. A blended approach — using an annuity to cover essential income and drawdown for discretionary spending — is common. Your health, other income, and risk tolerance are key factors. Seek independent advice.
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This calculator provides estimates for informational purposes only. It is not a substitute for personalised pension or financial advice. Speak to a regulated financial adviser before making pension decisions.