What Is a Retirement Calculator?
A retirement calculator estimates how much you need to save to maintain your desired lifestyle after you stop working. By factoring in your current savings, annual contributions, expected returns, and planned retirement age, it projects whether you are on track for a comfortable retirement.
How to Use This Retirement Calculator
- Enter your current age.
- Enter your target retirement age.
- Enter your monthly savings amount in the Current Savings field.
- Optionally enter a value in the Monthly Savings field.
- Click “Calculate” to see the projected retirement nest egg based on an assumed 7% average annual return, along with the total amount invested and years until retirement.
Key Concepts
The 4% rule is a widely referenced guideline suggesting you can withdraw 4% of your portfolio annually in retirement without running out of money over a 30-year period. To apply it, multiply your desired annual expenses by 25 to find your target nest egg. Inflation erodes purchasing power over time, so projections should use real (inflation-adjusted) returns. Starting early is crucial because compound growth over decades dramatically reduces the monthly savings required.
Required Savings = Annual Expenses × 25 (4% rule)
Frequently Asked Questions
How much do I need to retire?
A common benchmark is 25 times your annual expenses (based on the 4% rule). If you plan to spend $50,000 per year, you would target approximately $1,250,000 in savings.
What rate of return should I assume?
A balanced portfolio of stocks and bonds has historically returned around 6–7% annually after inflation. Using a conservative estimate helps ensure you do not fall short.
Should I factor in Social Security benefits?
Including expected Social Security or pension income reduces the amount your personal savings must cover. However, relying solely on government benefits carries risk, so treating them as a supplement is prudent.