Retirement Calculator
Estimate how much you'll have saved at retirement based on your current savings and contributions.
The Formula
PV = current savings · PMT = monthly contribution
r = monthly return · n = months to retirement
n = 420 months · r = 0.005833
FV = 20,000 × (1.005833)⁴²⁰ + 500 × [(1.005833)⁴²⁰ − 1] / 0.005833
= $1,374,000
How to Use This Retirement Calculator
Enter your current age, planned retirement age, current savings balance, expected monthly contribution, and estimated annual return. The calculator projects your total nest egg at retirement and estimates the monthly income it could generate. These are projections based on the inputs you provide — actual results depend on market performance and your savings habits. But even rough projections are far more useful than guessing.
How Much Do You Actually Need to Retire?
The most widely used benchmark is the 4% rule: you can withdraw 4% of your savings in year one of retirement, then adjust for inflation each year, with a historically high likelihood of not running out of money over 30 years. That means needing $60,000 a year requires roughly $1.5 million saved. The 25x rule says the same thing differently: save 25 times your expected annual spending. Your actual number depends on lifestyle, health, Social Security, any pension income, and how long you expect to live.
Why Starting Early Changes Everything
Retirement math rewards early starters more than almost anything else. A 25-year-old investing $300 a month at 7% will have close to $1 million by 65. A 35-year-old doing the exact same thing will have roughly $478,000 — less than half — despite only starting 10 years later. Those missing 10 years of compounding account for over $500,000. If you have not started yet, the second best time is today. Even small amounts invested consistently make an enormous difference over time.
Always Capture the Full Employer Match
If your employer offers a 401(k) match, contribute at least enough to get every dollar of that match before anything else. A 50% match up to 6% of salary is an instant 50% return on that portion — no stock, bond, or savings account can reliably compete with that. After the match, many financial advisors suggest maxing a Roth IRA next, then returning to the 401(k) for additional contributions.
Frequently Asked Questions
What is a good rate of return to use for retirement planning?
Most financial planners use 6–7% annually for a diversified mix of stocks and bonds, adjusted for inflation. Aggressive stock-heavy portfolios might use 8–9%. Conservative bond-heavy portfolios might use 4–5%. Be honest with yourself about your risk tolerance and investment mix — overly optimistic projections lead to undersaving. When in doubt, use the lower end of the range.
When should I start saving for retirement?
As early as possible. The math strongly favors people who start in their 20s, even with small amounts. But it is never too late to start. Someone in their 50s who maxes out a 401(k) ($23,000 per year in 2024, or $30,500 with catch-up contributions if 50 or older) and delays retirement a few extra years can still build a meaningful nest egg.
How much should I be saving each month?
The standard target is 15% of gross income, including any employer match. If your employer matches 5%, you need to contribute 10% yourself. If you are starting later in life, you may need to save 20–25%. Use this calculator to find your specific number based on your current age, savings, target retirement age, and expected return.
What is the 4% rule?
The 4% rule, developed by financial planner William Bengen in 1994, suggests retirees can withdraw 4% of their portfolio in year one of retirement, then adjust for inflation annually, with a high probability of the money lasting 30 years. Some recent research suggests 3.3–3.7% may be safer given potentially lower future returns, while others argue 5% is fine with flexible spending. Treat 4% as a useful starting guideline, not a guarantee.
Should I use a traditional or Roth 401(k)?
With a traditional 401(k), contributions reduce your taxable income now and you pay taxes on withdrawals in retirement. With a Roth 401(k), you pay taxes now and withdrawals in retirement are tax-free. If you expect to be in a higher tax bracket in retirement than you are today, Roth wins. If you expect a lower bracket, traditional wins. Many people benefit from splitting contributions between both to create tax flexibility in retirement.
What if I cannot afford to save for retirement right now?
Even $50 or $100 a month makes a real difference when you are young. Start with whatever you can and increase by 1% each year, or every time you get a raise. Many 401(k) plans offer auto-escalation features that do this automatically. Prioritize getting the full employer match first — that is free money. Then work toward building up from there.