As well as life expectancy, you should consider the investment growth of your fund when deciding how much to draw. If you look at the "Fund Divided by Years %" column, you will note that as you get older you can theoretically draw a larger amount from your fund - but this figure ignores investment growth in the fund. If your fund grew by 5%, it would result in the amount that you could draw from the fund, in that year, more than doubling at age 55, but only increasing by a little more than half at age 75.

Investment growth is therefore far more significant in the early years of retirement. In the early years you can also adopt a long term growth strategy and be less concerned about short term fluctuations in investment value. In the later years the investment strategy should be weighted towards security. You can also be less accurate in your longevity predictions in the early years while the consequences of similar inaccuracies in later years can lead to running out of money!

Earlier I briefly mentioned the "Years till 20% Survive" column in the table overleaf. If you choose to use this figure as a basis for your withdrawal strategy, it will reduce the amount you can draw from the fund but allow you to adopt longer term investment strategies. Your income should also be more predictable (investment disasters excluded).

As you will have to rely on your retirement income for many years you should consider the effect of price rises on your standard of living. You can look at how an increasing income will deplete your fund by using this calculator - it also allows you to select an assumed growth rate. However, due to the unpredictability of investment growth and personal longevity, it may be better to consider a rising income as an aspiration that can be considered when your financial position is reviewed annually.

Your fund may have to provide for you and your partner. The calculation of last survivor life expectancy is quite complicated and given the other variables in deciding how much income to take, the simple approach of basing the longevity estimate on the longest expectation of the two partners might be more practical than a complicated calculation. (You can find tables for both sexes here.)

In summary then: first you should make an estimate of your, and your partner's, if required, life expectancy by considering the overall average, your state of health and family history. If there are no reasons to believe that life expectancy is shorter than average, thought should be given to using the "Years till 20% Survive" figure. Then look at the withdrawals that can be taken from your fund to provide an income for the expected years. Finally, choose the investment strategy that is most appropriate, given the level of withdrawals and time till the fund is exhausted. The withdrawal and the investment strategies should be reviewed at least yearly and in later years traditional annuity purchase should be considered.

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