Personal Runway Calculator NZ 2026/27
This calculator answers the most practical question facing anyone about to leave a job for their own business: how long can I actually last? It starts with the money genuinely available to you, being liquid savings plus any redundancy or lump sum, and immediately subtracts the start-up costs you intend to pay out of the same pot, because those reduce your runway before the first month begins. Against that it sets your real monthly outgoings, separating housing from everything else since housing is usually the largest line and the slowest to change. Then it offsets whatever income is still arriving, being a partner's contribution to the household and whatever the business can realistically pay you. The difference is your monthly shortfall, and the capital divided by that shortfall is your runway in months, along with the month it ends. Because the most useful thing you can do with a runway figure is extend it, the page also models cutting personal spending by ten and twenty percent, and works backwards to the minimum monthly drawing the business would need to produce for you to reach a date you choose. That last number is often the most valuable output, because it turns a vague hope that the business will work into a specific monthly target. Figures are indicative planning estimates and not financial advice.
KiwiSaver is deliberately excluded from available savings. It cannot generally be withdrawn to fund a business or living costs. The recognised early withdrawal grounds are first home purchase, significant financial hardship, serious illness and permanent emigration.
Redundancy payments are taxed as an extra pay at your marginal rate, so enter the net figure you actually received, not the gross in your settlement agreement.
Drawings are entered by you and not tax adjusted here. How money is taken out of a business, and the tax that follows, depends on your structure. Shareholder salary, drawings against a current account and dividends are treated differently, so take advice before setting a figure.
Runway is not an emergency fund. Runway is capital you plan to consume; an emergency fund is capital held back for the unexpected. Set the emergency fund aside before calculating runway on the remainder.
Last verified: July 2026.
Where the runway comes from
| Liquid savings | $45,000.00 |
| Redundancy or lump sum | $28,000.00 |
| Less start-up costs paid personally | $12,000.00 |
| Capital available | $61,000.00 |
| Living costs a month | $3,200.00 |
| Housing a month | $2,400.00 |
| Total monthly outgoings | $5,600.00 |
| Less partner contribution | $1,800.00 |
| Less business drawings | $800.00 |
| Monthly shortfall to fund | $3,000.00 |
| Runway | 20.3 months |
| Savings run out around | - |
What cutting personal spending buys you
| Scenario | Monthly outgoings | Shortfall | Runway | Months gained |
|---|
The saving comes off the shortfall, not off total spending, which is why a modest cut buys a disproportionate number of months.
Reaching your target
| Target runway | 24.0 months |
| Capital you can consume each month | $2,541.67 |
| Monthly outgoings less partner income | $3,800.00 |
| Drawings the business must produce | $1,258.33 |
This is the monthly figure to aim the business at. It is a far more useful target than a general ambition to be profitable.
The Number That Decides Whether You Can Start
Most people planning a business spend their energy on the business plan and almost none on the personal one. That is the wrong way round, because the business does not fail first. The owner runs out of money first, takes a job to cover the mortgage, and the business quietly stops.
Personal runway is the constraint that actually binds. It sets the deadline by which the business has to be paying you something, and that deadline determines what kind of business you can sensibly start. Twenty months of runway allows a slow build with a product to develop and a market to find. Four months does not, and someone with four months of runway should be looking at work they can sell immediately rather than something that needs a year to mature.
Worked Example: $61,000 Buys 20.3 Months
Take the defaults. There is $45,000.00 of liquid savings and a $28,000.00 redundancy payment, already net of the tax that was deducted from it. Out of that comes $12,000.00 of tools, registrations and insurance to get started, leaving $61,000.00 of capital that can actually be lived on.
Monthly outgoings are $3,200.00 of living costs plus $2,400.00 of mortgage, which is $5,600.00. Against that, a partner contributes $1,800.00 a month and the business can pay $800.00, so $2,600.00 arrives and the monthly shortfall is $3,000.00.
$61,000.00 divided by $3,000.00 gives 20.3 months of runway. That is a comfortable position for most kinds of business, and the useful next question is not whether it is enough in the abstract but whether the business will be paying more than $800 a month within twenty months. If the honest answer is yes with room to spare, the plan works.
Small Cuts Buy Disproportionate Time
The most counter-intuitive result on this page is how much a modest reduction in spending is worth. The reason is that the saving comes off the shortfall rather than off the total.
Cutting personal costs by 10% saves $560.00 a month. That does not sound transformative. But it reduces the monthly shortfall from $3,000.00 to $2,440.00, which extends runway from 20.3 months to 25.0 months. A 10% cut has bought nearly five extra months.
A 20% cut saves $1,120.00, reduces the shortfall to $1,880.00, and takes runway to 32.4 months. That is twelve additional months from a reduction most households could achieve without genuine hardship.
The leverage works this way because the shortfall is a fraction of total spending. Where other income covers a large share of your costs, each dollar saved is a much larger proportion of the gap you are actually funding. If your partner covers most of the household, quite small economies can extend runway by a year or more.
Working Backwards From A Date
The most actionable output on this page is the last one. Rather than asking how long the money lasts, ask what the business needs to produce for the money to last as long as you need.
On the defaults, stretching $61,000.00 across 24 months allows $2,541.67 a month of capital consumption. Monthly outgoings less partner income is $3,800.00. The difference, $1,258.33, is what the business must pay you every month for the plan to reach two years.
That figure is worth far more than a general intention to become profitable, because it is testable. Can the business generate $1,258 a month of drawings within a few months? For most service businesses that is one or two decent jobs, which is a question you can answer honestly. Our Replace Your Salary Revenue Calculator converts a drawings target like this into the revenue required to support it.
The Mistakes That Shorten Runway
Counting KiwiSaver. It is not available. Starting a business is not a withdrawal ground, and including it produces a number you cannot spend.
Using the gross redundancy figure. A redundancy payment is taxed as an extra pay at your marginal rate, so the amount that reaches you is materially lower than the number in the settlement letter. Use what actually landed.
Underestimating monthly costs. Nearly everyone does, because the monthly figure they carry in their head covers the regular bills and omits the annual ones. Car registration and servicing, house and contents insurance, rates, dentist, school costs and Christmas are all real and all arrive. Take a year of bank statements, total the outgoings, divide by twelve, and use that rather than an estimate.
Optimistic drawings. The temptation is to assume the business will pay you something from month two. It frequently pays nothing for longer than expected, and money drawn early is often money the business needed for materials or its own tax bill. Model a conservative figure and treat anything better as upside.
Spending the emergency fund as runway. If the calculation consumes every dollar you have, then the first unexpected cost, being a car, a tooth or a client that does not pay, becomes a crisis. Set aside a genuine emergency fund first and calculate runway on what remains. Our Emergency Fund Calculator sizes that separately.
Runway Is Not Only About Money
One honest caveat. A long runway is protective, but it can also be permissive: knowing there are thirty months of savings makes it easier to avoid the uncomfortable work of selling. Some of the most successful small businesses are started by people with short runways, precisely because there was no alternative to finding paying customers quickly.
The useful discipline is to set a review point well before the money runs out, perhaps at the halfway mark, and to decide in advance what evidence you would need to see by then to keep going. That converts a slow drift towards zero into a decision made with money still in the bank and options still open.
Related NZ Business and Personal Finance Calculators
- Cash Runway Calculator: the same question asked of the business rather than of you.
- Redundancy Runway Calculator: how long a redundancy payment lasts while looking for another role.
- Emergency Fund Calculator: size the reserve to set aside before you start spending down runway.
- Business Startup Cost Calculator: build the start-up figure this page deducts from your capital.
- Replace Your Salary Revenue Calculator: the revenue the business needs to reach the drawings target above.