Your financial runway: if the income stopped today, how many months or years could you cover your spending from savings? Useful for an emergency fund, a career break, redundancy, or the road to financial independence.
Assuming a 4% return and 3% rising costs. Investing meaningfully extends how long cash lasts.
| Savings | How long it lasts |
|---|---|
| $10,000 | 3 mo |
| $25,000 | 8 mo |
| $50,000 | 1 yr 3 mo |
| $100,000 | 2 yrs 6 mo |
| $250,000 | 6 yrs 3 mo |
| $500,000 | 13 yrs |
| $1,000,000 | 27 yrs 11 mo |
A common target is three to six months of spending in easy-access savings, more if your income is irregular or a single earner supports the household. Put your savings and monthly spending in above and aim for a runway in that range as a first milestone.
If your return is higher than what you draw each year, the balance can grow rather than shrink, so it never runs out. That is the idea behind financial independence: once your pot reaches about 25 times your yearly spending, investment returns alone can usually cover your costs.
Money you might need within a year or two is usually best in cash or high-interest savings, since investments can fall right when you need them. Longer-term savings can be invested for higher expected returns. This tool applies one blended return; adjust it down if a lot of your money is in cash.