Retirement Paycheck

The total-income-target input, the grow-then-withdraw simulation, the naive real-return figure, and the static historical lookup table behind the “% success” number.

Overview

The Retirement Paycheck Calculator turns a target monthly retirement income into a year-by-year portfolio drawdown and shows how long the portfolio lasts. All of its math runs server-side in RetireCalc.Engine.

The “monthly income” input is a total, not a withdrawal

The monthly amount you enter is your total target monthly retirement income — everything you want to live on. It is not the amount withdrawn from the portfolio. The engine subtracts your guaranteed income (Social Security + pension + other) to find what the portfolio actually has to provide:

• Total income target — what you enter.
• Guaranteed income — subtracted first.
• Portfolio-funded withdrawal — the remainder, and the only part the portfolio simulation draws.

The reported withdrawal rate is that first-year portfolio-funded withdrawal divided by the portfolio balance at the retirement date (after any pre-retirement growth, before the first withdrawal) — not against today’s balance and not against the total income target.

The year-by-year simulation

The return used throughout is a single net figure: netReturn = annualReturn − fees − taxDrag. Before retirement the portfolio is grown at that rate for each accumulation year. In each drawdown year, growth is applied before the withdrawal is taken:

If “increase withdrawals with inflation” is on, both the portfolio withdrawal and the guaranteed figure are escalated by (1 + inflation)^y; if off, both stay level in nominal dollars. The portfolio is depleted the first year the balance reaches zero or below, and the simulation stops there.

Real return

The “real return” shown is a simple (naive) approximation — the net return minus the inflation rate:

It is not the exact Fisher relation (1 + netReturn) ÷ (1 + inflation) − 1 that the Safe Withdrawal Rate Calculator uses. The difference is small at typical rates but the two figures are not identical.

The “% success” number

The success percentage is not computed from your simulation and is not a Monte Carlo or personalised forecast probability. It is a look-up from a fixed table of estimated historical success rates for a 30-year retirement horizon, indexed by two values:

• Row — your first-year withdrawal rate, rounded to the nearest 0.5% (table rows run 3.0% to 8.0%).
• Column — your real return (the naive netReturn − inflationabove), rounded to a whole percent and clamped to the −1% … 5% columns.

The looked-up value is then capped at 50% if your own simulation depletes the portfolio before your entered life expectancy. Because the table is fixed at a 30-year horizon, the number does not change if you model a longer or shorter retirement — only your withdrawal rate and real return move it.

Limitations

• Deterministic fixed-return model — no market variability, no sequence-of-returns risk.
• Taxes and fees are modelled only as flat percentage drags you enter, subtracted from the return. There is no RMD, Social Security benefit-taxation, or IRMAA logic.
• Guaranteed income is held flat (or inflation-escalated together with spending) — no claiming-age math and no COLA forecast.