Are you saving enough for the retirement you want?
Use this planner to calculate your retirement nest egg based on your current income, savings rate, and future budget. We'll show you if you are on track or if you need to adjust your contributions.
Retirement Plan Details
Enter your financial details below.
How We Calculate Your Results
1. The Growth Phase: We calculate your investment growth from your current age to your retirement age using compound interest. We separate your "Principal" (the actual cash you put in) from "Interest" (the market returns) to show the power of compounding in the chart above.
2. The Income Phase: To estimate how much your nest egg can pay you, we use the 4% Safe Withdrawal Rule. This rule suggests you can withdraw 4% of your total savings annually without running out of money for at least 30 years.
3. The Gap Analysis: Finally, we add your estimated investment income to your "Other Income" (like Social Security) and compare it to your "Monthly Budget."
Formula: (Nest Egg * 0.04 / 12) + Other Income - Monthly Budget = Surplus or Shortfall.
Frequently Asked Questions
How much money do I need to retire comfortably?
A common rule of thumb is the "Rule of 25," which suggests you need to save 25 times your expected annual expenses. For example, if you need $40,000 per year from your savings (after Social Security), you should aim for a nest egg of $1,000,000.
What is the 4% Safe Withdrawal Rule?
The 4% rule is a guideline used by financial planners. It assumes that if you invest in a balanced portfolio of stocks and bonds, you can withdraw 4% of your starting balance in the first year of retirement, and adjust that amount for inflation every subsequent year, with a very low risk of running out of money for 30 years.
Does this calculator account for inflation?
The calculations above use "nominal" returns, meaning they do not subtract inflation. To view your results in "today's dollars" (purchasing power), you should lower your "Expected Annual Return" by the inflation rate. For example, if you expect an 8% market return and 3% inflation, enter 5% as your return rate.
How much of my income should I save?
Most experts recommend saving 15% of your pre-tax income annually starting in your 20s or early 30s. If you start later, you may need to increase this to 20% or 25% to catch up.
