Floor and Enjoy.
Build your retirement income plan.
The Floor and Enjoy strategy separates guaranteed income (the floor) from invested assets (the enjoy). Calculate your floor gap, how much portfolio it takes to fill, and what remains for growth.
The question it answersHow much of my retirement portfolio do I need to cover essential expenses?
Rules: United States. Privacy: runs in your browser. What you enter stays on your device unless you copy a share link, which puts your inputs in the link.
US-only. Annuity rates and Social Security are US references. Other countries use different mechanisms.
Worked example: Essential expenses $4,500/mo. Social Security $2,200/mo. Floor gap $2,300/mo ($27,600/yr). At an assumed 6% SPIASingle Premium Immediate Annuity (SPIA)An annuity bought with one lump sum that starts paying within about a year, for life or a set period like 20 years. A lifetime payout removes the risk of outliving that money, but the purchase generally cannot be undone, payments depend on the insurer staying solvent, and fixed payments lose buying power to inflation. payout: $460,000 to fund the floor. Portfolio $800,000. After floor funding: $340,000 for the "enjoy" portion. This $340,000 can ride out market downturns because essentials are already covered.
Methodology: left bar shows monthly guaranteed-income sources stacked. Right bar shows portfolio dollars split between floor coverage and discretionary enjoy.
Projection, not a promise. The result follows the assumptions you enter. Real results will differ, sometimes by a lot.
How this tool works
- Floor gap = essential expenses - guaranteed income. If guaranteed income exceeds essential expenses, your floor is already covered.
- Portfolio to fill floor = (annual gap) / (SPIA payout rate). At a 6% SPIA payout, $1,000/year of guaranteed income costs roughly $16,667 in lump sum. With a gap and no payout rate (blank or 0%), or a rate outside 2% to 25%, the tool asks for a rate instead of showing a cost.
- Blank fields count as $0. Negative numbers are rejected: the results clear and the analysis names the field to fix.
- Enjoy portfolio = total portfolio - portfolio needed for floor. This is the discretionary growth allocation.
- SPIA payouts vary by purchase age, gender, current interest rates, and insurer. The default 6% is a rough, conservative site estimate, not a published figure. It sits below typical 2026 single-life quotes for buyers in their late 60s or early 70s, so it tends to overstate the cost of the floor; joint-life and inflation-adjusted contracts pay less. Get an actual quote before committing.
- The Floor and Enjoy framework comes from safety-first retirement-income research verify×DON'T TRUST, VERIFYClaim: The Floor and Enjoy / floor-and-upside framework (a guaranteed spending floor plus a risky upside portfolio) is documented in retirement-finance research, including Scott and Watson's floor-leverage rule.Verify at: Boston College Center for Retirement Research ↗ · Scott and Watson (2013) "The Floor-Leverage Rule for Retirement," Financial Analysts Journal ↗ Source 1 in the list belowThe two-bucket / floor-upside framework has academic precedents in lifecycle finance..
- This calculation does not adjust for inflationinflationA general increase in prices over time, meaning each dollar buys less than it did before.Full definition. SPIAs typically pay a fixed nominal amount unless you buy an inflation-adjustedInflation-adjustedAdjusted for rising prices. Some amounts move with inflation, like IRS tax brackets, TIPS principal, or I-bond rates. Others are restated in today's dollars so different years can be compared: by the BLS consumer price index, $30,000 in 1985 bought about what $93,000 buys in 2026. variant (which has lower starting payouts).
- You do not have to buy a SPIA to use this framework. The "portfolio needed for floor" is a planning anchor; you can fund the floor with a TIPS ladderTIPS ladderTreasury Inflation-Protected Securities (TIPS) bought so some mature each year, giving yearly income that rises with CPI inflation, often for a retirement income floor. Held to maturity, price swings do not matter, but income ends with the last bond, and in taxable accounts inflation adjustments face federal tax yearly., a bond ladder, or a more conservative withdrawal rate from the equity portfolio.
Not financial advice. Annuity rates change frequently. Get current quotes before relying on the floor calculation.
HOW THIS IS CALCULATED
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- Essential expenses = housing + food + utilities + healthcare premiums + transportation + other essentials, per month.
- Guaranteed income = Social Security + pension + other guaranteed income, per month.
- Floor gap = essential expenses − guaranteed income, floored at $0. Annual gap = monthly gap × 12.
- Portfolio to fill the floor = annual gap ÷ SPIA payout rate. At the default 6%, each $1,000 a year of floor costs $16,667. If there is a gap and the rate is blank, 0%, or outside the accepted 2% to 25%, no cost is shown and the tool asks for a rate.
- Blank fields count as $0. A negative number in any field is rejected: every result shows a dash and the analysis names the field.
- Enjoy portfolio = total portfolio − portfolio to fill the floor, floored at $0.
- Analysis color: red when the floor costs more than the portfolio (the shortfall is shown); orange when the enjoy portion is under 30% of the portfolio; green otherwise, including when guaranteed income already covers essentials; gray when there is nothing to price yet (no essential expenses entered, or a gap with a missing or out-of-range payout rate); red with a message when a field is negative.
The 6% payout rate is a rough site estimate used as a planning default, not a quoted or published rate. Real SPIA payouts depend on age, sex, insurer and interest rates, so the field takes a quote you have. Nothing is adjusted for inflation: the gap is in today's dollars and the annuity payment is treated as fixed. Income taxes on the floor income and the risk of the insurer failing are not modeled. Verify the methodology or inspect the source code in your browser's dev tools.
Where to go from here
Sources
Verify badges in the text link to these sources. Figures, rates and rules change: check each source’s date before acting on it.
Calculators are educational estimates, not financial advice. Disclosures · How pages are reviewed