Retirement Savings Calculator
Project your retirement balance and monthly income based on current savings, contributions, and expected return.
Two numbers drive retirement readiness more than anything else: how much you contribute and how early you start. This calculator makes both concrete. A $200/month increase in contributions starting at 35 adds roughly $200,000 to a retirement balance at 65, at 7% return. Starting that same increase at 45 adds about $100,000. Time is the most powerful variable in the equation.
The 4% rule: a retirement portfolio can sustain 4% annual withdrawals indefinitely (historically). To produce $5,000/month ($60,000/year), you need $1,500,000 saved. That is your target number.
The 4% safe withdrawal rule
The 4% rule comes from the Trinity Study (1998), which tested how long various portfolios lasted under different withdrawal rates across historical market cycles. A 4% annual withdrawal rate on a diversified stock/bond portfolio has historically sustained 30 years of withdrawals with high reliability. It is a starting point, not a guarantee. More conservative planners use 3.5% or 3% to account for longer retirements and uncertain future returns.
The contribution vs growth split
Early in a saving career, contributions dominate the balance. Later, investment returns dominate. On a 30-year timeline at 7% return, roughly 60-70% of the ending balance comes from investment growth rather than contributions. This is why starting early, even with small amounts, produces dramatically different outcomes than starting later with larger amounts. The math strongly favors time over amount.
Sequence of returns risk
The order in which investment returns occur matters enormously near retirement. A major market decline in the first few years of drawing down a portfolio does far more damage than the same decline occurring later. This is why many financial planners recommend holding 1-2 years of expenses in cash or short-term bonds near and during retirement, reducing the need to sell equities at depressed prices to cover living expenses.
Frequently asked questions
How much do I need to retire?
Divide your desired annual income by 0.04 (the 4% rule). $60,000/year needs $1,500,000. $48,000/year needs $1,200,000. $80,000/year needs $2,000,000. Social Security income reduces the amount you need to fund from savings. Run the numbers with your expected Social Security benefit subtracted from the desired income figure for a more accurate target.
What return rate should I use?
For a diversified stock/bond portfolio, 6-7% real return (after inflation) is a reasonable long-term planning assumption. More conservative: 5%. For an all-equity portfolio: 7-9%. The specific number matters significantly over 30 years. Run multiple scenarios rather than committing to a single assumption.
Is Social Security included here?
No. Social Security income, pension income, or any other guaranteed income stream reduces the amount you need to fund from savings. Subtract expected monthly Social Security from your desired monthly income, then enter the remaining gap as your income target for a more realistic savings goal.