Retirement Calculator
About Retirement Calculator
Planning for Retirement
Retirement planning is arguably the most important financial calculation you’ll ever do. The question is deceptively simple: how much money do you need to stop working and maintain your lifestyle? The answer depends on your desired annual income, how long retirement might last, inflation, investment returns, and social security or pension income. Most financial planners use the 4% rule as a starting point – you can safely withdraw 4% of your portfolio per year without running out of money over a 30-year retirement. That means to generate $60,000 per year, you need $1.5 million saved.
How This Calculator Works
This tool calculates the nest egg you need based on your desired annual retirement income and a safe withdrawal rate. It then works backward to determine how much you need to save each month to reach that goal, factoring in your current age, retirement age, current savings, expected return, and inflation. The result is a concrete monthly savings target you can act on today.
How to Use This Calculator
Enter your current age, planned retirement age, desired annual retirement income, current savings, expected annual return before retirement, expected return during retirement, and the inflation rate. The calculator shows your required nest egg, monthly savings needed, and a projection of your portfolio value through retirement. Adjust the inputs to see how working a few extra years or saving a bit more each month changes the outcome.
Frequently Asked Questions
What is the 4% rule?
The 4% rule suggests you can withdraw 4% of your retirement portfolio in the first year and adjust for inflation each subsequent year, with a very high probability of not running out of money over 30 years.
How much do I really need to retire?
A common guideline is 25 times your desired annual spending. If you want $50,000 per year, target $1.25 million. Adjust up for longer retirements or down if you have pension income or social security.
What return rate should I assume before retirement?
A diversified portfolio of stocks and bonds has historically returned 7-8% after inflation. Use 6-7% for a more conservative estimate. During retirement, a more conservative 4-5% is prudent as you shift to lower-risk investments.
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