How to Avoid Running Out of Money in Retirement
20 August 2026 · Eric
The aim is a spending rule you can actually stick to, then adjust gently as markets and life change. There is no single safe number that works for everyone. It depends on your balance, other income including the Age Pension, your investment risk, and how flexible your spending can be. A calculator and a few simple guardrails make the trade-offs clearer.
Why this matters
Most people we hear from are not short of information. They are short of a process. Statements arrive every quarter with a number on them, and no one has sat down and explained what that number actually means for how much you can spend.
Without a clear spending rule, it is easy to land on either side of the same problem. Underspend, and you miss out on the life your super was meant to fund. Overspend early, particularly into a weak market, and you put later years at risk. Neither outcome comes from a bad decision. It comes from not having a rule to check decisions against.
A calm process with regular checkpoints keeps you in control and keeps your choices open, in both directions. That is a very different feeling to guessing and hoping.
How it works
Start with the two kinds of spending. Essential costs, housing, food, health, utilities, and discretionary spending, travel, gifts, the things that make retirement feel like retirement. Knowing the split is the first guardrail. It tells you what has to be funded no matter what markets do, and what has room to flex.
From there, test more than one scenario. A single projection assumes markets behave the way they have on average. They rarely do, and the timing of a downturn matters more than most people expect, a poor run of returns early in retirement can do more damage than the same run later on. Modelling a few different paths, a strong market, a flat one, and a rough start, shows you the range your plan actually needs to handle, instead of one number that may or may not hold up.
Set a spending floor and a ceiling. The floor covers what you need regardless of markets. The ceiling is what you allow yourself in a good year, and it can flex down if a weaker one arrives. Guardrails like this mean an adjustment is a planned response you decided on in advance, not a panicked decision made mid-downturn.
Finally, build in review points. Once a year as a baseline, and again after a significant market move or a change in your circumstances, a health cost, a change to your living situation, anything that shifts either side of the equation.
What this means for you
This is general information, not a plan built around your specific numbers. Everyone's mix of super balance, other income, and Age Pension eligibility is different, which is exactly why a repeatable process matters more than any single figure someone else hands you. A written rule you can check yourself against removes a lot of the guesswork that keeps this question sitting at the back of people's minds.
Practical next steps
- Write down your essential and discretionary spending as two separate lists.
- Run a few drawdown scenarios through a retirement calculator, not just one.
- Set a spending floor and ceiling you are comfortable adjusting within.
- Put a review date in the calendar, at least once a year, and after any big market move.
Model your own guardrails
Knowing the process is the easy part. Building the actual scenarios and guardrails around your own numbers is where most people get stuck, and that is exactly the gap SuperYears is being built to close.
See how a floor-and-ceiling spending plan could work with your own balance, before you commit to anything.
We'll let you know as soon as we launch.
Information provided is general in nature and does not constitute personal financial advice. You should consider seeking advice from a licensed financial planner before making any financial decisions.
Sources: As at 17 February 2026, MoneySmart's retirement planner (moneysmart.gov.au/retirement-planner) and super withdrawal guide (moneysmart.gov.au/how-super-works/super-withdrawal).