The planning Page

Short and simple

For a couple

For an individual

The planning calculator is more suitable if you are over age 40

On this page

Understanding your planning calculator results

About the two kinds of income

Fixed Incomes
Dependable, regular and stable, they are your state pensions and other guaranteed incomes.

Portfolio Income
Your portfolio is the total value of non-guaranteed pensions and investments, for example; personal pensions and ISAs. Each year, you should draw enough money from your portfolio to fill the gap between your fixed incomes and your spending needs.

If your Portfolio runs out of money, there are many ways to compensate for this, for example adjusting your income need now or at a later age, deferring retirement or downsizing your home.

About the Graphics

Blue bars

Orange bars

Green bars

Each bar is one year, hover on the bars in your income calculator to show your income

Fixed Income’ is guaranteed to last your lifetime. It includes the State pension and other guaranteed pensions and investments. This is the foundation for your long-term income, your top-up income, the orange bars, will fill the shortfall. 

‘Top-up Income’ will withdraw money from pensions and investments to top up fixed incomes until the investments run out.
You should include Pensions, ISAs, Bonds, Shares and any other available money.
Your income is increased annually by the inflation rate.

‘Investment value’ is the value of your investment money, used to pay your top-up income. Once it depletes the top-up income will stop. 

Meet Simon and Serena

They are both age 63, needing £30,000 a year income. They have full state pensions and a combined £300,000 in their personal pension portfolio and Serena expects to live three years longer.

Their retirement is a year before their state pensions are due at age 66, so in the first year, the first orange bar shows that all their income is drawn from pension funds.

The second year both state pensions start and the orange bar shows they need £12,193 top-up money. Their state pensions are the blue bars.

Hover over each yearly bar in your income calculator, and you will see the value for that year.

Graph 1
investment 1
The Green bars shows they run out of money, so they must rely on state pensions in the final years.

On the downside it runs the capital down to zero allowing them to draw the maximum income for the minimum cost. Consequently, cutting it fine can be risky, unless you have some extra savings in reserve to fall back on.

When one partner lives longer than the other, they lose their deceased partner’s state pension and possibly some other fixed incomes, so the Portfolio has more work to to later in life.

Planning calculator examples

Example 2

Example 3

Same as above but their income is slightly reduced by 15% at age 80 and life expectancy extended to 100.

investment 1

This time Serena is age 61, two years younger than Simon.

First year, Here Serena is working, but Simon has retired before his state pension begins next year.
Second year, Serena continues to work, Simon now has his state pension.
Third  year, Finally, Serena stops working, but waits a further year for her state pension.

Year 16. Joint income reduces by 15%.

Serena younger

Detailed results table

See Step by Step to underatand this table in detail

This table is for example 3. You find it at the foot of your planning page, detailing each type of income for every year into the future.


Nothing stays the same

Unless you’re fortunate enough to have largely lifetime guaranteed indexed-linked pensions, there will be some risk to the certainty of your long-term income, which is why you need to review.

If you re-visit the planning calculator at least once a year it will address this concern, because changes in your life and investment returns will mean necessary and continued adjustments to your plan.


Create a sound income stream

Try firstly to allocate money to secure your living expenses, the money you can’t do without. Secondly, think about how much to allocate to top up your income for the things you want out of retirement.

Income Priorities

Your most important basic living expenses, including housing, food, clothing, transportation, healthcare, and relevant miscellaneous costs. Most importantly have these covered by secure incomes, or at the very least, low risk investments. Once you have this in control, consider a more flexible approach for your investments and pensions.

Lifestyle extras, meals out, holidays, extra personal expenses.

One-off occasional costs

Unexpected and unplanned for items.

Separate your savings

It’s helpful if you manage your investments using two separate pots.

However, it may not be possible to do this physically, so make sure you have savings in reserve and that you keep records of values for both pots.


POT number 1 should be invested so it has the potential to achieve the rate of growth you’ve chosen.

It is solely for income generation to top up your income shortfall. More likely to be long term such as Personal or Workplace Pensions, Bonds and Invested ISAs, depending on your circumstances.

You should include the value of your current bank account to pay regular outgoings and receive income from investment.


POT number 2 is savings money to be set aside and drawn from when needed.

Use it for special holidays, unexpected costs for you and your family and anything that isn’t regular spending. In addition you may also have capital for estate planning and support in old age.

Include money here that is not likely to keep up with the expected growth rate needed to keep pace with your income needs.

Savings money is for any investments, for instance bank deposits and fixed rate investment, pensions, ISAs, shares, anything not needed for income in pot number one.