How the Numbers Work

Every formula, assumed value, and source behind the numbers you see on this site is collected here on this one page. If you're curious about what's going on under the hood, take a look.

1. The Overall Flow

Starting from your current age, the simulation repeats the calculation one year at a time up to your assumed life expectancy (default: age 90). For each year, it adds up your income, expenses, and investment returns to show how your assets move over time.

Nothing is ever sent to a server. It all runs entirely inside your own browser.

2. Calculating Income

The take-home rate is a stepwise approximation by "work style" and "income bracket." Student part-time periods assume no social insurance deductions and are therefore higher (about 92% for income under ¥2M); full-time employees are about 67–83% with social insurance enrollment; the self-employed and freelancers, who pay National Health Insurance and the National Pension entirely themselves, are about 60–86% (the under-¥2M figure reflects the ¥1.78M income-tax-free threshold from the 2026 reform). Because the retirement income deduction makes the lump sum almost entirely tax-free in most cases, it is added at full value without applying a take-home rate. The spousal deduction, mortgage tax credit, and iDeCo income deduction are planned for Phase 2.

3. Calculating Expenses

4. Calculating Investments

The calculation uses monthly contributions made at the start of each month (annuity-due, paid at the beginning of the period). This is the same method as the Financial Services Agency's tsumitate NISA simulator, Rakuten Securities, SBI Securities, and others (monthly rate = annual rate ÷ 12), so the numbers should line up with each company's accumulation simulator.

next-year balance = current balance × (1+i)12 + monthly contribution × ((1+i)12 − 1) ÷ i × (1+i)    (i = annual rate ÷ 12)

Example: ¥30,000/mo at 5% per year for 30 years ≈ ¥25.0M. Principal ¥10.8M + investment gains ≈ ¥14.2M.

Within the NISA limits (¥3.6M/yr, ¥18M lifetime), capital gains are tax-free, and Phase 1 assumes this. Amounts beyond the annual or lifetime limit are normally subject to 20.315% capital gains tax, but a student's monthly contributions (¥30,000–50,000) usually fit within the NISA limit. The iDeCo expansion (2027: up to age 70, ¥62,000/mo for Category 2) is planned for Phase 2.

5. Post-retirement Asset Withdrawal

After retirement, contributions stop and the investment balance at retirement is drawn down using the Trinity 4% Rule (fixed amount). It's a simple calculation — "assets × 4% ÷ 12 = monthly amount" — and historically it's a conservative rule with a 30-year depletion rate of around 4–5%. In addition to the default fixed4 mode, you can choose the more conservative safe3 (3%) mode.

annual withdrawal = investment balance at retirement × 4% (or 3%) (withdrawn amounts are treated as cash)

In Japan's low-interest-rate environment, some argue that "3% is the safe figure" (Morningstar 2025). Furthermore, because Japan's pension taxation, National Health Insurance premiums, and long-term-care insurance premiums differ from the U.S. model, some hold that the assets needed are larger than 25× (around 27–28×) to be safe. Post-retirement living costs are set to continue at the pre-retirement level (rent included), and whatever the monthly pension fails to cover is drawn down from investments. Once the investment balance runs out, cash starts to decline, shown visually as a red negative region on the graph.

6. Conditions That Trigger Alerts (Warnings and Suggestions)

7. This Is Still Only a "Rough Guide"

As it stands, the calculation gets you to the point where, by choosing a career path and moving the sliders, you can get a rough sense of how your money flows in the future. But life is more complex than that. If any of the points below apply to you, please read the displayed numbers with a bit of leeway.

About the household model

• It's a single-person household model — dual-income households and a partner's income are not reflected. You can manually adjust the monthly pension in "08 Later Life" to a married-couple model (about ¥220,000–230,000) or a self-employed couple (about ¥110,000).
• The region is a Tokyo-metro-suburbs model — rent, minimum wage, and property tax vary by region. If you live in a regional city, lower the rent; if you live in central Tokyo, raise it, and adjust roughly to suit.

Assumptions of the withdrawal rule

• The Trinity 4% Rule is based on U.S. research — in Japan, accounting for pension taxation, National Health Insurance premiums, and long-term-care insurance premiums, some argue the assets needed are larger than "annual spending × 25" (around 27–28×) to be safe. It's reassuring to view the F.Age (Financial Independence Age) target amount on the conservative side.
• Macroeconomic indexation is not reflected — the real purchasing power of public pensions is projected to decline in the future (income replacement rate 61.2% in 2024 → 57.6% in 2037, 2024 Fiscal Verification). Since this site calculates on a present-value basis, please consider the risk of future purchasing-power decline separately.

Systems and deductions we'd like to support going forward

• New NISA limit management (¥3.6M/yr, ¥18M lifetime) — a student's monthly contributions don't usually exceed this, but it matters if you contribute heavily once you're working.
• iDeCo expansion (effective January 2027; salaried workers without a corporate pension ¥62,000/mo, extended to age 70)
• Free university education (multi-child households, three or more dependents, starting FY2025)
• Raising the threshold for the in-work old-age pension (April 2026, ¥500,000 → ¥620,000 → ¥650,000)
• Mortgage tax credit (0.7% of year-end balance, up to 13 years, ¥210,000/yr)
• Grant-type scholarships and repayment waivers (currently only loan-type repayment is supported. Grant-type scholarships and reductions are to come)

Market volatility and life risks

• Investment returns are calculated at a fixed annual rate — in reality there is volatility, and in downturns they can temporarily shrink significantly.
• A crash right after retirement (Sequence of Returns Risk) is not reflected — depending on market conditions at the time of retirement, there's a risk the withdrawal plan falls apart.
• One-time long-term-care and medical costs — these vary greatly in advanced old age, but are not reflected here.
• Inheritance and gifts, as well as exchange-rate movements and currency diversification, are also not considered.

Systems already reflected (free early childhood education and care, high school tuition support, the Oct 2024 child allowance expansion, the ¥1.78M tax-reform threshold) are listed in the §10 "Status of Reflected System Reforms" table below.

8. Sources and References

These are all public materials. Click a link to view each agency's latest version. Next to each source, we add one line on "what this material determines."

• Ministry of Health, Labour and Welfare (厚労省) "Basic Survey on Wage Structure, 2024" — basis for starting salaries by educational path (high school grad ¥198,000 / vocational ¥223,000 / junior college ¥224,000 / university grad ¥248,000)
• Ministry of Health, Labour and Welfare (厚労省) "General Survey on Working Conditions, 2023" — basis for the retirement lump sum (university grad ¥18.96M / high school grad ¥16.82M)
• Japan Pension Service (日本年金機構) "Pension amounts from April 2025 onward" — basis for the ¥150,000/mo single employees' pension model
• National Tax Agency (国税庁) "Withholding Tax Tables" + Japan Health Insurance Association (協会けんぽ) Health Insurance and Employees' Pension premium rates (2025–2026) — basis for take-home rates by work style and income bracket (60–92%)
• Ministry of Finance (財務省) "FY2026 Tax Reform Outline" — basis for the ¥1.78M income wall (¥620,000 basic deduction + ¥740,000 minimum guaranteed employment income deduction)
• Children and Families Agency (こども家庭庁) "Guide to the Child Allowance System" (October 2024 expansion) — basis for ¥15,000/¥10,000 per month, ¥30,000 for the third child, and no income limit
• Children and Families Agency (こども家庭庁) "Free Early Childhood Education and Care" (effective October 2019) — basis for effectively zero daycare fees for ages 3–5
• Ministry of Education, Culture, Sports, Science and Technology (文科省) "High School Tuition Support System" (public April 2025, private April 2026) — basis for free high school tuition
• Ministry of Education, Culture, Sports, Science and Technology (文科省) "FY2023 Survey of Student Payments at Private Universities, etc." — basis for the average entrance fee and tuition at private universities
• Ministry of Education, Culture, Sports, Science and Technology (文科省) "National University Standard Amounts" (entrance fee ¥282,000, tuition ¥535,800/yr) — basis for national/public university payments
• Ministry of Education, Culture, Sports, Science and Technology (文科省) "FY2023 Survey on Children's Learning Costs" — basis for total annual learning costs in elementary, junior high, and high school
• Cabinet Office (内閣府) "Survey on Child-rearing Costs" + Ministry of Internal Affairs and Communications (総務省) "Family Income and Expenditure Survey" — basis for monthly child-rearing costs (food, clothing, pocket money, etc.)
• Ministry of Internal Affairs and Communications (総務省) "Overview of Property Tax" — basis for the ¥120,000/yr property tax guide after a home purchase
• Financial Services Agency (金融庁) "Asset Management Simulation" — the industry-standard accumulation formula for tsumitate NISA (monthly annuity-due)
• Cooley/Hubbard/Walz (1998) Trinity Study — the original source of the 4% Rule (a safe withdrawal rate for retirement assets)
• Morningstar Safe Withdrawal Rate Review 2025 — source for the conservative "3% is safe" view
• Ministry of Health, Labour and Welfare (厚労省) "2024 Public Pension Fiscal Verification" — source for the future outlook of the income replacement rate under macroeconomic indexation

9. Source Code

The calculation logic is collected in assets/js/compute.js. The setting values (starting salaries by path, retirement lump sums, education costs, tax rates) are externalized in config.json, so for annual updates you only need to rewrite that file to reflect the changes. You can peek at it through your browser's developer tools, so if you're curious, please come take a look.

10. Status of Reflected System Reforms (v1.1, updated 2026-05-22)

"✓ Reflected" means it is built into the v1.1 calculation. "Not reflected" items will be addressed in turn in future versions. System reforms change every year, so we'll also share the latest status in the update history on About.