What Retirement Income Gap Is Left on $100,000 of Desired Income With $1,500,000 Invested, $55,000 of Non-Portfolio Income, and a 4% Withdrawal Rate?

Calculated answer

$45,000

The example includes $55,000 from Social Security, pension, rental, dividend, and other passive income sources. At 4%, a $1,500,000 portfolio supports about $60,000 per year, leaving a surplus of $15,000.

Annual income gap: $45,000
Non-portfolio income: $55,000
Portfolio-supported income: $60,000
Surplus: $15,000

How the Retirement Income Gap Is Estimated

Income gap = desired retirement income − non-portfolio income

The portfolio is then checked separately by applying the chosen withdrawal rate to the invested balance.

Start with a desired retirement income of $100,000 per year.
Add non-portfolio sources such as Social Security, pension, rental income, dividends, and other passive cash flow.
Subtract those sources to find the remaining gap.
Apply the 4% withdrawal rate to $1,500,000 to estimate how much the portfolio may cover.

Retirement Income Sources

Annual amount
Desired retirement income	$100,000
Social Security	$30,000
Pension	$12,000
Rental income	$6,000
Dividend income	$4,000
Other passive income	$3,000
Total non-portfolio income	$55,000

Why the income gap matters

Retirement planning often feels more practical when income sources are separated into dependable non-portfolio cash flow and the amount the portfolio must fund.

That separation makes it easier to stress-test taxes, withdrawal rates, part-time work, and changes in spending assumptions.

What this example leaves out

This simplified view does not model taxes on each income source, future benefit changes, sequence-of-returns risk, or spending that changes over time.

It should be used as an educational planning snapshot rather than a full retirement cash-flow forecast.

Model Your Own Retirement Income Mix

Use the full calculator to change retirement income goals, income sources, portfolio size, and withdrawal assumptions.

Open the Retirement Income Gap Calculator Browse All Retirement Income Gap Examples

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Frequently Asked Questions

Is a zero gap always the goal?

Not always. Some retirees may want extra margin for taxes, health care, travel, or irregular expenses, while others may be comfortable with more flexible spending.

Why check the portfolio separately with a withdrawal rate?

Because the portfolio has to fund whatever non-portfolio income does not cover. The withdrawal rate gives a simple first-pass estimate of that spendable amount.

Does this example prove the income plan is sustainable?

No. Sustainability depends on return sequences, inflation, taxes, fees, and how spending changes over time. Use withdrawal and sustainability tools alongside this gap analysis.