Will your retirement savings last?

My financial adviser ran Monte Carlo simulations that say I have an 85% chance my retirement savings will last into my 90s. Is an 85% probability safe enough? — Tracey G.

The short answer is yes. Although there’s no official benchmark for the appropriate margin of safety, I think most advisers would say that an 80% to 90% probability of success is about right for most people.

Fall below 80% and you could find yourself short on money later in retirement. Shoot for a chance of success higher than 90%, on the other hand, and you may end up sitting on a big pile of savings very late in life.

That may not sound like a bad thing, but it could mean that you lived more frugally than you had to during your career and stinted more than necessary in retirement. In other words, you might have been able to spend more freely and enjoy yourself more during both your working and retirement years.

That said, there are some caveats to the probability numbers that advisers generate with their retirement planning software — or that you can get on your own from calculators like those in my Retirement Toolbox. One major caution: your chances of success can drop pretty dramatically if your nest egg’s value takes a sharp dive. Given the stock market’s recent volatility, that’s a possibility to keep in mind.