Seven retirement income sources—and how to model each one honestly

1. Social Security

Use the estimate for the age when you plan to start. Write down the date. For a couple, remember that both checks usually do not continue after one spouse dies.

2. Pension income

Check if the pension rises with prices and what a surviving spouse would get. A pension for one life is not the same as one that keeps paying a spouse.

If you can take one large payment instead, compare taxes, how long you may live, who will invest the money, and what your spouse would get.

3. Portfolio withdrawals

Money from savings may come from interest, dividends, or selling investments. The tax bill can differ by account.

Pick a starting withdrawal. Then test rising prices, a bad early market, fees, and taxes. Keep every guess where you can see it.

4. Net rental-property income

Start with rent you collect. Subtract the mortgage, taxes, insurance, management, repairs, and empty months. Only the money left can pay retirement bills.

Also test a long empty period or a big repair. Decide if you plan to keep the property or sell it later.

5. Annuity income

Write down when checks start, if they rise with prices, and what a survivor gets. An annuity promise also depends on the insurance company that makes it.

6. Part-time or consulting work

Use the pay left after taxes and work costs. Give the job an end date. Do not make retirement depend on working at an age or health level that may not be possible.

7. Alimony, royalties, and other recurring payments

Write down how long the payment lasts, how it may change, its taxes, and why it could stop. A payment for life is not the same as one that ends in a few years.

Add the income to your plan. Then test what happens if it ends early.