Story by Laura Miller

Are you likely to run out of money in retirement? New analysis assesses your chances© Getty Images

A £100,000 pension pot could last anything from a lifetime to just 13 years, depending on how much income you take and your level of investment returns, according to analysis by Standard Life.

The aim of any retirement plan is to try not to run out of pension money. While the state pension is a guaranteed income once you’ve reached state pension age, likewise a defined benefit pension, drawing down from a defined contribution pension requires a delicate balance to avoid outliving your limited pot.

The impact of investment returns – higher or lower – can mean the difference of tens of thousands of pounds of retirement income over a decade. And while modest withdrawal rates could see a pension last as long as you do, the worst case scenario of taking out larger amounts coupled with poor investment returns can be a recipe for running out of cash.

Hundreds of thousands of people could be at risk from a toxic combination of higher withdrawal rates and lower returns, according to FCA data.

Pete Cowell, head of annuities at Standard Life, said: “Pension freedoms gave retirees greater choice and flexibility, but with that freedom came responsibility and considerable financial planning challenges to weigh up.

“However, with defined benefit pensions in decline, and more people approaching retirement with larger, defined contribution pensions, monitoring the balance between withdrawals and investment returns has never been more critical to avoid outliving a pension.”

How much should I withdraw from my pension?

Two withdrawal scenarios were considered in the research – based on a pension pot of £100,000 – one with a fixed withdrawal of £4,000 per year and a higher one at £8,000 per year.

These are equivalent to the 4% pension rule and 8% of the initial pot respectively and are common withdrawal amounts, according to the Financial Conduct Authority’s retirement income data for 2023/24.

The analysis then assessed the impact of different investment returns on the pension pot after 10 years, ranging from a return of 8%, 5% and 2%.

Impact of annual withdrawal and investment growth rates based on a £100,000 pension pot

Annual withdrawal	Investment growth rate per year	Pot value after 10 years
£4,000	8%	£141,000
£4,000	5%	£101,000
£4,000	2%	£70,400
£8,000	8%	£83,900
£8,000	5%	£51,700
£8,000	2%	£27,800

Figures rounded down to three significant figures. Figures assume annual management charge of 0.75% and are not adjusted to account for inflation

Impact after 10 years of withdrawing £4,000 per year

After 10 years, those who withdrew £4,000 of their pension each year would have a pot worth between £141,000 if they secured 8% returns and just £70,400 with 2% returns. This works out at a difference of £70,600, showing how important investment returns are on people’s retirement incomes.

Impact after 10 years of withdrawing £8,000 per year

For those who withdrew £8,000 each year, their pot would be worth between £83,900 if they secured 8% returns and just £27,800 with 2% returns. The impact of the additional withdrawals is particularly stark when compared to the lower withdrawal outcomes.

How long will my pension last?

The analysis looked ahead to assess how long the pension pots would last in each of the different scenarios.

Those who took £4,000 each year would not exhaust their pot if it grew by either 5% or 8%, as the investment returns would offset those withdrawals. In the 2% growth scenario, their pension would still last 29 years.

In the higher withdrawal scenario, however, each of the pots would eventually run out, with the pot in the high (8%) return scenario lasting 28 years compared to just 13 years in the low (2%) return equivalent.

Impact of annual withdrawals and investment growth rates on the longevity of a £100,000 pension pot

Annual withdrawal	Investment growth rate	Pot longevity
£4,000	8%	Lifetime
£4,000	5%	Lifetime
£4,000	2%	29 years
£8,000	8%	28 years
£8,000	5%	17 years
£8,000	2%	13 years

Figures assume annual management charge of 0.75% and do not account for inflation

Through these illustrative scenarios, the investment returns are predictable each year, but the reality is that people will experience investment ups and downs while in drawdown which makes predicting how much your pot will be worth all the more difficult.

Inflation will also be a key consideration, as people will need to manage this risk over the long-term to ensure their purchasing power isn’t eroded.

The FCA’s retirement income data shows the risk of running out of money is widespread, given the number of people withdrawing at higher levels.

More than 225,000 individuals made withdrawals at 8% or above in 2023/24, according to the regulator’s figures, highlighting the potential risk of outliving their savings.

Of this number, the figures also show more than 50,000 individuals with pension pots between £50,000 and £99,000 made regular withdrawals of 8% or more in 2023/24.

Some 40,000 individuals with pots between £100,000 and £249,000 were also drawing down at this level.

Cowell said: “There are options for those who want to mitigate investment and longevity risk. Many people are opting to cover their essential living costs with a guaranteed income through a combination of the state pension and an annuity.

“This approach removes many of the unknowns as you know your core living costs will be met while also providing the potential for investment growth on any pension placed in drawdown.

“With the Pension Scheme Bill expected to legislate for default retirement income solutions, we expect to see approaches that blend a combination of income certainty and flexibility become more and more mainstream.”

If you have just started your investment journey, you may be thinking

It can be disheartening to see your hard earned disappear from you account.

Remember the rules and stick to your plan, knowing that out of adversity, comes opportunity, as you will be able to buy shares for your Snowball at discounted prices.

Only with luck is it possible to buy at the bottom of the market , so don’t waste too much time and energy trying too.

But it’s possible to buy the yield, so if you are happy with the yield, better if it’s close to the next xd date, you could trade. Of course the price could continue to fall and the yield will improve, no one should pretend it’s easy.

As always it’s best to DYOR, a watch list is published on a Saturday so you can monitor the direction of the yield. Make your own decisions and as long as your are right more often than you are wrong, remember an optimist and a pessimist arrive at the same destination at the same time but the optimist has the better journey.

5 Small Stocks, 5 Super-Sized Payouts of Up To 11%

Brett Owens, Chief Investment Strategist
Updated: March 6, 2026

What’s better than getting to buy 6.6%-11% yields at discounted prices?

How about snapping those sweet dividend payers while momentum is on your side?

Late in 2025, I wrote about a “small-cap reawakening”—a bullish tailwind from retreating Federal Reserve rates that had begun to propel smaller companies forward and could continue well into 2026.

So far, so true. Small- and mid-cap stocks (or “SMIDs”) alike have been cruising full sail ahead while their larger cousins have been dead in the water.

2026 Has Been a Reversal of Longstanding Large-Cap Dominance

Better still for you if you haven’t yet taken the plunge into Wall Street’s more diminutive stocks: Small caps’ hot start has done little to drive up valuations. They still look like a screaming bargain compared to the market’s bigger names:

Broad-Market Forward P/Es:

• S&P 500: 21.2
• S&P MidCap 400: 17.0
• S&P SmallCap 600: 15.6

Fair warning: Economic turbulence is almost always tougher on smaller-cap equities, so we could always be a market scare away from a flight back into large caps.

The fuel driving smaller companies could run out in a few months, too. The Fed declined to move its target interest rate lower in late January, and the market is betting we don’t see another step lower until summer at the soonest.

But we’re all aware that a step into small caps means swallowing at least a spoonful of risk. Our best bet? Find the most advantageously positioned small caps… and get paid a truckload while we hold on for the ride.

Which is exactly what I see in these five small caps paying us between 6.6% and 11.0% right now.

Washington Trust Bancorp (WASH)
Dividend Yield: 6.6%

Financial firms as a group don’t deliver much more income than the broader market, but you can find some downright respectable yields in the sector’s smaller names: specifically, regional banks and credit unions.

Washington Trust Bancorp. (WASH), for instance, currently pays more than 6%.

This 225-year-old regional bank is neither in Washington, D.C., nor Washington State. Instead, it was named for the nation’s first president, and it proudly claims that it was “the first bank to print George Washington’s likeness on currency—69 years before President Washington appeared on the federally issued one-dollar bill and 132 years before the Washington quarter appeared.”

The operations are typical bank fare: personal and business banking offerings such as checking, savings, mortgages, financing and wealth management. The stock really hasn’t been noteworthy, either, delivering subpar performance relative to both the market and the financial sector for quite some time. WASH shares were barely above breakeven in 2025—and that’s only once we include its sizable dividend!—following a balance sheet repositioning near the end of 2024.

But Washington Trust is alive and well in 2026. In January, the company’s Street-beating results were helped by net interest margins that improved by 16 basis points YoY for the fourth quarter, and by 53 basis points YoY for the full year. The news sparked one of the biggest moves in WASH stock in years. Meanwhile, shares still trade for just 10 times earnings that are expected to jump by 27% in 2026 and offer one of the best yields in banking.

Though I’d Like to See Washington Trust Make a Move in Its Dividend, Too

Diversified Energy Company (DEC)
Dividend Yield: 8.0%

When we think of “integrated” energy companies, we typically think of mega-cap titans like Exxon Mobil (XOM) and Chevron (CVX). But $1 billion Diversified Energy Company (DEC) checks off the right boxes, too.

It produces predominantly natural gas, but also some oil and natural gas liquids (NGLs), from the Appalachian (70% of production) and Central (30% of production) regions of the U.S. It also has about 17,000 miles of gathering and transportation lines, as well as compression stations, and it’s a top-25 North American gas marketer. It even has a well retirement service arm: Next LVL Energy.

It’s an odd stock with an odd history. The company started in the U.S. back in 2001, but it didn’t list publicly until 2017—on the London Stock Exchange. It only began trading in the U.S. in 2023, when it launched a secondary listing on the New York Stock Exchange; those NYSE shares became the company’s primary listing in 2025. Shares have delivered all the excitement of a small-cap company since then.

But They’ve Also Delivered Very Little Upside

That largely reflects the Diversified model—rather than undergoing capital-intensive drilling and development programs that can make splashy discoveries, DEC instead acquires long-life assets and tries to squeeze as much life out of them as possible.

Last year was no exception. The company completed the acquisition of “liquids-rich” Maverick Natural Resources in March 2025, then closed on a purchase of Oklahoma-based oil-and-gas E&P firm Canvas in November. The buying has continued this year; DEC recently announced it was buying natural gas properties in east Texas from Sheridan Production.

There’s admittedly not much room for breakneck growth in this model. But it does adequately fund a generous dividend yielding 8% right now, on a stock that trades at less than 8 times this year’s earnings estimates.

Granite Ridge Resources (GRNT)
Dividend Yield: 8.5%

Granite Ridge Resources (GRNT) is another energy name with an unorthodox business model. It says it “combines the agility of an investment firm with the expertise of an energy company.” In practice, it doesn’t operate anything—it simply holds oil and gas assets in the Permian, Eagle Ford, Bakken, Haynesville, DJ and Appalachian formations.

It’s almost fitting, then, that the company didn’t go public via a traditional IPO, but via special purpose acquisition company (SPAC). Investment firm Grey Rock Investment Partners merged in October 2022 with Executive Network Partnering Corporation (the SPAC).

GRNT hit the market with a thud, dropping like a rock over the first few months. Since then, it has delivered roughly breakeven returns (and that’s after factoring in the 8%+ dividend), which is right in line with its nonexistent dividend growth.

However, like DEC, Granite Ridge might have been building toward something in 2025, with the company projecting 28% production growth for the full year. That should allow the company and its roughly 3,200 wells to take better advantage of any improvements in price.

But unlike other small energy names, Granite Ridge appears to be a primarily steady cash flow and dividend producer first, and a growth prospect second.

5 Small Stocks, 5 Super-Sized Payouts of Up To 11%

Perrigo (PRGO)
Dividend Yield: 10.2%

Perrigo (PRGO) is an over-the-counter health and wellness company with a wide range of products we’re all used to seeing on Walgreens and CVS shelves: sinus and allergy relief, antacids, sleep aids, pain relievers, toothbrushes, skin care, vitamins, contraceptives and more.

It’s also a long, long, long way removed from its heyday of roughly a decade ago.

In 2015, Perrigo was a large cap on the rise—so much so that it attracted the advances of global generics specialist Mylan. PRGO rebuffed Mylan several times, most notably in April 2015 when it turned down a $205-per-share offer, then a $232-per-share offer shortly thereafter. Perrigo’s board, then its shareholders, turned back a hostile bid later in the year.

After That, It Was Likely Nothing But Regrets

The top and bottom lines have stagnated or declined in most years since 2015. Generics margins suffered amid growing competition, and FDA approvals tapered off. The company has since undergone multiple restructuring plans and pivoted to lean harder into self-care products. But it’s still sliding; during its Q4 2025 report, it said sales would be down 1.5% to 5.5% in 2026, and adjusted diluted earnings per share would fall by 16% to 27%.

A few days earlier, it also announced that it would keep its dividend level—maybe not surprising given its continued weakness, but perhaps another warning sign given that PRGO is currently riding a 22-year streak of annual dividend growth.

Perrigo is very much a stock to watch just given the potential to pick up a double-digit yielder on the cheap—it currently trades at a skinny 5 times 2026 earnings estimates. But we need to see some signs of operational stabilization first; otherwise, this small cap will just keep getting smaller.

Insperity (NSP)
Dividend Yield: 11.0%

Insperity (NSP) is a human resources (HR) and business solutions provider to small- and medium-sized businesses. That’s payroll, benefits, HR, employee onboarding, time and attendance, performance and more, provided through multiple Insperity-branded platforms.

This is a name that has only recently started to ping my high-yield radar, which usually means one of two things has happened:

1. A massive dividend increase, say, double or more (rare)
2. The stock has plunged into the earth’s core (common)

It’s Pretty Clear What We Have on Our Hands

The stock is unsurprisingly cheap as a result, trading at 10 times this year’s earnings estimates.

The question is whether NSP is a generational value play or a falling knife.

The plunge was due to a complete erosion of Insperity’s bottom line, as well as sentiment for both small- and midsized businesses and the labor market. The company earned $171.4 million in 2023, then $91 million in 2024, then suffered a $7 million net loss in 2025. Health care costs have been a major factor here, chewing into Insperity’s margins.

But the top line hasn’t flinched. Revenues have climbed in all but one year over the past decade, and they’re expected to keep rising by single digits in each of the next two years. A renegotiated contract with UnitedHealth Group (UNH) could relieve some of its cost pressures. And there’s potential in its new Insperity HRScale—an HR platform built in partnership with Workday (WDAY) that promises “faster deployment and simpler setup” and that the company expects will host 6,000 to 8,000 paid worksite employees (WSEEs) by year’s end.

It might be enough for a turnaround, but even if it is, we have to consider whether the dividend will still be there. The $2.40 per share that Insperity pays across the year was more than twice NSP’s adjusted earnings in 2025, and it’s projected to overshoot 2026 profits, too.

This 11% Dividend Is Overlooked, Too—But in Much Better Position

I don’t want to have to pinch my nose and pray before buying a double-digit dividend.

So I won’t. And you shouldn’t, either.

Right now, one of my favorite home-run dividends pays every bit as much as NSP. But it’s not a down-on-its-luck HR play hoping for a rebound in the economy and job market—it’s a heavily diversified, brilliantly built bond portfolio that is also set up to rise in price if interest rates keep falling.

This fund checks off just about every income box I can think of:

• It pays a whopping 11% in annual income!
• It has increased its dividend over time
• It has paid out multiple special dividends
• And it pays its dividends each and every month!

That’s a resume few income investors could resist … and why would we?

This fund pays us $1,100 for every $10K we invest. All we need to do is sit back, relax, and let a skilled manager call the shots.

There is £19,837 to re-invest and although anyone buying next week will have more of a chance of buying a losing position, I get this itch when there is cash sitting in the account not earning any income.

And

I’m going to buyback RECI to collect the dividend, although looking at how the share fell in 2020, I will keep a close watch over it.

I am going to sell DNDL with a yield of 6% at a loss as I would rather own either CTY or MRCH. I would like to buy LWDB but Mr. Market would have to smile on me.

The intention it to then pair trade the share to ensure the blended yield is 7% and then hold thru thick and thin and there will be plenty of thin to try to double the capital either including dividends or without.

The working example is Law Debenture, a Trust that most people would have liked to have owned.

The two periods highlited are the covid crash and the Trumps tariffs last April.

The remainder of the chart shows the usual buying and retracing of the price, no one said it’s easy.

If you buy now most Trusts will lose some of your hard earned, although there are always some winners but it’s still best to earn some dividends to re-invest, just in case your research is wrong

At the covid low the LWDB yield was 7% but that’s unlikely to be repeated.

The current buying yield would be 9%

Having achieved the Holy Grail of investing, you could take out your stake and re-invest in a higher yielder, whilst still receiving income from LWDB at a cost of nil, zero, zilch.

Sorry boys and girls, it’s slightly more boring when we look back at the current year and look forward to the new financial year starting next month, when we start with zero, zilch in the pot.

2025/26 Income total should be £13,225.00

The total includes some special dividends, so is not going to be repeatable for the next tax year but as its been re-invested it should earn around another 1k in dividends.

The SNOWBALL is ahead of the plan and the fcast for next year is £10,500.00 and the target £11,240.00

For those with a modest amount to invest, compound interest in year one is £700 but in year ten it’s £5,869, with compound interest you stand to make a similar amount in the last year of your plan than in the first five years.

Whilst a dividend re-investment plan is beneficial in all markets, it’s especially beneficial when markets are crashing. Also better if you are adding funds to your Snowball because you get more shares for your money and therefore more dividends.

The SNOWBALL has a comparator share VWRP.

The current value of VWRP is £152,392, even after this week’s fall not too shabby.

Using the 4% rule that would provide income of £6,117.00.

If you use your 25% TFLS to provide a buffer cash fund so you are not selling shares when markets are crashing, the income figure would be £4,571.76

With your SNOWBALL you wouldn’t want to sell any shares that are providing income, so when you start drawdown, you could take 25% of your income tax free. All subject to current tax rules.