A 67-Year-Old Single Retiree With $920,000 Can Stretch It to Age 95 If the COLA Holds Above 2 Percent

A retiree with $920,000 saved and $2,800 monthly Social Security appears well positioned because annual spending of $58,000 leaves a $24,400 gap after benefits, implying a withdrawal rate near 3%. The main risk comes from future Social Security cost-of-living adjustments, since inflation differences over a long retirement can erode purchasing power and turn a seemingly safe plan into a prolonged shortfall. Planning should extend to age 95 based on SSA period life table probabilities. Spreading the portfolio across roughly 28 years requires the portfolio to generate income without relying on equity-like drawdowns in years when withdrawals are needed. The $24,400 gap can be funded differently across yield tiers, with conservative assumptions requiring about $697,000 at 3.5% and leaving the remainder growth-oriented for later years.

"The real uncertainty, however, hides inside a deceptively small detail: future cost-of-living adjustments on Social Security. Over a retirement that could stretch 28 years or more, even modest differences in inflation and COLA growth can dramatically change the retiree's financial trajectory. If benefits fail to keep pace with rising expenses, a plan that once looked rock-solid can slowly turn into a long, quiet battle against shrinking purchasing power."

"SSA Period Life Table data implies a healthy 67-year-old woman has roughly a 50% chance of reaching 88, 25% of reaching 93, and 10% of reaching 96. Planning to 95 is the responsible step. Stretching $920,000 across 28 years requires the portfolio to do real work without taking on equity-like risk in years it cannot afford a drawdown."

"The portfolio only has to cover the gap between spending and Social Security. Here is what that gap costs at three yield tiers, using current market reference points. Conservative tier, 3% to 4%. Broad dividend growth equity funds, investment-grade bond ladders, and Treasury notes anchor this tier. The 10-year Treasury is about 4.5% and the 30-year is roughly 5%, which means a laddered Treasury sleeve alone produces more than enough on a small slice of capital."

"To generate the full $24,400 at 3.5%, the math is $24,400 divided by 0.035, or about $697,000 of capital. The rest of the $920,000 can stay growth-oriented to fund years 15 through 28."

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