Why use this calculator
Retirement planning is one of the most important financial decisions you'll make. This calculator helps you determine if you're on track to maintain your desired lifestyle in retirement, using the widely-accepted 4% withdrawal rule.
How to use it
Enter your current age, desired retirement age, current savings, monthly contribution, expected return rate, and desired annual retirement income. The calculator projects your savings and compares it to the amount needed using the 4% rule.
The formula
Projects future savings using compound interest with regular contributions, then applies the 4% rule (multiply desired annual income by 25) to determine the target nest egg.
Worked examples
30-year-old saving $500/month with $50,000 already saved at 7% return
Projected $1.1M by age 65 — enough for $44,000/year using the 4% rule
When people use it
- Long-term retirement planning
- Evaluating if current savings rate is sufficient
- Comparing retirement age scenarios
Tips
- The earlier you start, the more compound interest works in your favor
- Increase contributions with each raise
- Consider inflation when setting income goals
- Diversify investments based on your time horizon
Questions people ask
- What is the 4% rule?
- The 4% rule suggests you can withdraw 4% of your retirement savings annually with a high probability of not running out of money over a 30-year retirement. It's a widely-used guideline for retirement planning.
- How much do I really need to retire?
- A common target is 25 times your desired annual retirement expenses (the inverse of the 4% rule). If you want $60,000 per year, aim for $1.5 million in savings.