Plan how much to save monthly to reach your retirement goal. See your projected balance and how long it will sustain your lifestyle.
How the Retirement Calculator Works
This calculator models two phases: the accumulation phase (saving and growing your money before retirement) and the distribution phase (spending it in retirement). It uses monthly compounding during accumulation and the 4% rule as a sustainability benchmark.
Accumulation: Balance grows monthly at (annual rate / 12) + contributions
Safe Withdrawal: 4% rule = withdraw 4% of balance annually
Sustainability: Models monthly withdrawals vs. 4% real return
Frequently Asked Questions
A common rule of thumb is 25x your annual expenses (based on the 4% rule). If you spend $60,000/year, you'd need about $1.5 million. However, this varies based on retirement age, expected returns, Social Security income, and healthcare costs.
The 4% rule says you can withdraw 4% of your retirement portfolio in year one, then adjust for inflation each year, and your money should last at least 30 years. It's based on the Trinity Study analyzing historical market returns from 1926-1995.
Social Security currently replaces about 40% of pre-retirement income for average earners. The program faces funding shortfalls after 2034, which may lead to reduced benefits. It's safest to plan as if Social Security is a bonus, not your primary income.
For stocks, 7% real return (after inflation) is the historical average. A balanced 60/40 portfolio averages about 5% real. Use lower rates (4-5%) for conservative planning. Remember: even small return differences compound significantly over decades.