Retirement Bucket Strategy Calculator NZ

This calculator helps you set up a bucket strategy for your retirement savings in New Zealand, dividing your pot into a cash bucket, an income bucket and a growth bucket so your money is matched to when you will spend it. The bucket approach is a popular and intuitive way to manage drawdown. The cash bucket holds the next year or two of spending in the bank, ready to draw on. The income bucket holds a few more years of spending in stable, lower-volatility assets like term deposits and bonds. The growth bucket holds the rest in shares and other growth assets, with the time to ride out the inevitable market falls before you need it. The point of the structure is protection against sequence-of-returns risk: because you spend from cash and refill it from the income and growth buckets over time, you are never forced to sell shares straight after a downturn to fund this year's living costs. You enter your total savings, your annual spending, and how many years of spending you want in the cash and income buckets, and the calculator sizes each bucket in dollars and as a share of your pot. Review and top up the cash bucket each year. This is general information, not personalised advice.

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Cash $80,000 · Income $200,000 · Growth $320,000
suggested bucket split
Cash (now)$80,000
Income (medium)$200,000
Growth (long term)$320,000

Cash and income buckets are sized from your spending and chosen years; growth is the rest. Top up cash from the other buckets over time. Estimate only.

How it works

The cash bucket is your annual spending times the cash years, and the income bucket is your spending times the income years. The growth bucket is whatever is left of your total savings after those two are set aside. The calculator also shows each bucket as a share of the pot.

Worked example

With 600,000 dollars and 40,000 dollars of annual spending, 2 years in cash is 80,000 dollars and 5 years in income is 200,000 dollars, leaving 320,000 dollars in growth. You spend from cash and refill it from the other buckets over time.

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Frequently asked questions

What is the bucket strategy?

It divides retirement savings into a cash bucket for the next year or two of spending, an income bucket of stable assets for the medium term, and a growth bucket of shares for the long term. You spend from cash and top it up from the others over time.

Why use buckets?

Holding a couple of years of spending in cash means you are not forced to sell shares after a market fall, which protects against sequence-of-returns risk. The growth bucket has time to recover before you need it.

How big should each bucket be?

A common approach is one to two years of spending in cash and several more years in income assets, with the rest in growth. The calculator sizes the buckets from the years you choose and your annual spending.