Retirement Calculator
A retirement calculator projects how current savings and future contributions may grow by retirement. It also compares the projected balance with a simple target based on desired annual retirement income and withdrawal rate.
Quick answer
Retirement readiness depends on savings, contributions, time, investment returns, spending, taxes, Social Security, and longevity. This estimate is a planning starting point, not a guarantee.
Calculator
How to use this calculator
- Enter your current and planned retirement ages.
- Add current savings and monthly contributions.
- Choose a cautious expected return.
- Enter the annual income you want from investments and a withdrawal rate.
- Review the projected balance, target, and gap.
Explanation
What it is
A retirement calculator projects how current savings and future contributions may grow by retirement. It also compares the projected balance with a simple target based on desired annual retirement income and withdrawal rate.
How it works
The calculator compounds current savings and monthly contributions to retirement age. The target balance equals desired annual portfolio income divided by the selected withdrawal rate.
When to use it
Use this calculator to compare realistic scenarios before making a financial decision, and update the inputs when rates, costs, income, or goals change.
Limitations
- The result is an estimate based only on the inputs and assumptions shown.
- It does not evaluate eligibility, product terms, market conditions, or personal legal and tax circumstances.
- Actual outcomes can differ because of fees, timing, rounding, taxes, and provider-specific methods.
Key terms
- Retirement balance
- The amount projected to be available when retirement begins.
- Withdrawal rate
- The percentage of a portfolio withdrawn in the first retirement year.
- Real return
- Investment return after accounting for inflation.
- Contribution rate
- The share or amount of income saved for retirement.
- Savings gap
- The difference between a target and projected balance.
Formula
The calculator compounds current savings and monthly contributions to retirement age. The target balance equals desired annual portfolio income divided by the selected withdrawal rate.
Worked example
A 35-year-old with $80,000 saved, $750 monthly contributions, and a planned retirement age of 67 can compare projected savings with an income-based target.
FAQ
How much do I need to save for retirement?
A useful estimate starts with expected annual spending, subtracts reliable income such as Social Security or a pension, and converts the remaining need into a portfolio target. Personal circumstances vary widely.
How much should I have saved by age 40?
Rules of thumb often compare savings with salary, but they do not account for retirement age, pension income, spending, family needs, or prior opportunities to save. A personalized projection is more useful.
What return should I use in a retirement calculator?
Use a conservative assumption that reflects your asset allocation, fees, inflation treatment, and risk. Testing lower and higher scenarios is better than assuming one precise outcome.
Does this include Social Security?
No. Enter only the annual income you want your investment portfolio to provide after considering Social Security, pensions, or other reliable income.
Is a 4% withdrawal rate guaranteed to work?
No. It is a historical planning rule, not a promise. Market returns, inflation, retirement length, taxes, fees, and spending flexibility all matter.
What can I do if I have a retirement savings gap?
Consider increasing contributions, delaying retirement, reducing planned spending, improving tax efficiency, or adjusting the investment plan within your risk tolerance.
Common mistakes
- Treating one return assumption as a forecast.
- Ignoring Social Security, taxes, healthcare, and inflation.
- Using current spending without adjusting for retirement.
- Failing to update the plan after major life changes.
Tips
- Model several retirement ages.
- Separate essential and discretionary spending.
- Include employer matches and expected income sources.
- Review the plan at least annually.
Sources and editorial review
Educational estimates only; not personalized financial, tax, legal, lending, investment, or insurance advice.