Your year in money
Most financial planning conversations focus on the big numbers - your pension pot, your target retirement age, your expected income. What gets talked about less is what retirement actually feels like to manage from month to month. Where does the money come from each month? What happens when outgoings exceed income? Who's keeping an eye on it?
This is a walkthrough of a single year in a typical retirement projection, using giltedge to show what's happening and why.
The situation
Our subject is in their mid-sixties, recently retired. They have a pension pot they're drawing from, a state pension that's just started, and an investment portfolio they'd prefer not to touch too often. Monthly outgoings run to around £6,900. Monthly income from pension drawdown and state pension comes to around £2,700. The gap - roughly £4,200 - needs to come from somewhere.
That somewhere is giltedge's three-tier cascade: cash, savings, and investments, each with a role to play.
January - the year begins with a rebalance
January opens with savings lower than it should be - £8,000 against a target floor of £15,000. giltedge automatically draws £27,000 from investments and routes it into savings, restoring the buffer. Savings then sends £4,200 to the current account to cover that month's shortfall.
The pension paid out £1,800 net this month, after the provider deducted basic rate tax at source. State pension added £900. Total income: £2,700. The rest came from savings, as planned.
Meanwhile the pension pot itself grew by around £3,200 in investment returns - partially offsetting the drawdown.
February and March - quiet months
With savings refilled, investments stay still and compound. Savings covers the monthly shortfall. Cash stays at £10,000. Nothing dramatic happens, which is exactly the point.
April - the state pension uprating
Each April, the state pension increases. This year it rises from £900 to £930 a month. A small change, but it means savings needs to send a little less to cash each month - around £4,170 instead of £4,200.
May - an inflation adjustment
Pension drawdown also increases in May - an automatic inflation-linked step up to £1,850 net per month. Income is now £2,780 a month in total. The monthly shortfall continues to shrink.
June - savings needs refilling again
By June, five months of transfers to cash have brought savings down to £12,000 - below its floor again. giltedge draws £23,000 from investments and routes it through to savings. Investments then stay still for the rest of the summer.
This is the pattern: investments move rarely, in meaningful chunks, while savings absorbs the day-to-day variation. Fewer investment disposals means fewer potential capital gains tax events.
July to September - three quiet months
The plan runs on autopilot. Savings covers the monthly shortfall. Investments grow. The pension continues its steady payments. These are the months that rarely get written about but matter enormously.
October - a direct draw from investments
In October, savings is nearly at its floor and the month's shortfall is larger than usual. Rather than drain savings further, giltedge draws £20,000 directly from investments to the current account. The amount is set in the app's assumptions - a minimum batch size that avoids making small, frequent disposal events.
Cash rises briefly to £23,000 before settling back as outgoings clear.
November and December - the buffer unwinds
No top-up needed. Cash drifts back from £23,000 toward £10,000 over two months. The year closes tidily.
The year in numbers
Investments fell by £14,000 - drawn on three times during the year for a total of £70,000 in disposals, while growing by £56,000 in returns. The pension fell by £22,000 - paying out £21,600 in net drawdown while growing by around £16,000. At this drawdown rate the pension has roughly twelve years of runway remaining.
Start of year
Cash: £10,000
Savings: £35,000
Investments: £420,000
Pension: £280,000
End of year
Cash: £10,000
Savings: £33,000 (-£2,000)
Investments: £406,000 (-£14,000)
Pension: £274,000 (-£6,000)
What giltedge shows you
Every number in this walkthrough is visible in giltedge's Movements page - month by month, category by category. You can see exactly when investments moved, how much savings transferred to cash, and what the pension paid out after tax.
One figure worth watching each January is the true-up - the Self Assessment settlement between tax withheld at source by your pension provider and your actual annual liability. In years where total income pushes into higher rate territory, that January figure can be significant. giltedge projects it in advance so it doesn't come as a surprise.
A year like this isn't exciting. The numbers move, the buffers refill, the pension pays out. But that steadiness is what a working retirement plan looks like - and seeing it laid out month by month is rather reassuring.
