Retirement Calculator

Retirement Calculator — What It Does

Enter your current age, retirement age, existing savings, monthly contribution, and expected return rate to project how much your portfolio will be worth at retirement. The calculator applies compound growth, adjusts for inflation, and estimates sustainable monthly income using the 4% withdrawal rule — giving you both nominal and real (today's dollar) projections.

Key Inputs Explained

• Current savings — Your total investable retirement assets today (401k, IRA, brokerage).
• Monthly contribution — How much you add to retirement accounts each month.
• Annual return — Expected average yearly growth rate. Use 6–7% for a balanced portfolio.
• Inflation rate — Typically 2–3%. Used to convert nominal projections to real purchasing power.
• Retirement age — The age at which you plan to stop contributing and start withdrawing.

Retirement Savings Milestones

• By age 30 — aim to have 1× your annual salary saved
• By age 40 — aim for 3× your annual salary
• By age 50 — aim for 6× your annual salary
• By age 60 — aim for 8× your annual salary
• At retirement (67) — aim for 10–12× your annual salary

These are guidelines from Fidelity and similar institutions — your actual needs depend on your expected expenses, Social Security benefits, and lifestyle goals.

Common Retirement Planning Mistakes

• Ignoring inflation — A plan that looks sufficient in nominal dollars may fall short in real purchasing power.
• Underestimating longevity — Plan for 30+ years in retirement. Many people live into their 90s.
• Forgetting healthcare costs — Medical expenses often increase in retirement and should be factored in separately.
• Not increasing contributions — Even small annual increases (1–2% of salary) compound dramatically over decades.

Frequently Asked Questions

What is the 4% rule for retirement income?

The 4% rule is a popular withdrawal guideline: you can safely withdraw 4% of your portfolio in year one, then adjust for inflation each year, and have a high probability of not outliving your money over a 30-year retirement. For a $1,000,000 portfolio, that is $40,000 per year or about $3,333 per month.

How does inflation affect retirement savings projections?

Inflation erodes purchasing power over time. A 3% annual inflation rate means $1,000 today will only buy about $412 worth of goods in 30 years. This calculator adjusts your projected portfolio to show real (inflation-adjusted) values alongside nominal values so you can plan accurately.

How much should I save each month for retirement?

A common rule of thumb is to save 10–15% of your gross income starting in your 20s. If you start later, you may need to save 20–25% or more. The key variables are your current age, target retirement age, existing savings, expected return rate, and desired monthly income in retirement.

What annual return rate should I use for retirement projections?

Historically, a diversified equity portfolio has returned about 7% per year after inflation. Conservative projections use 5–6% nominal (before inflation). Bond-heavy portfolios may use 3–4%. For realistic planning, use 6–7% nominal and subtract your expected inflation rate (typically 2–3%).

What is the difference between nominal and real (inflation-adjusted) returns?

Nominal return is the raw percentage gain before accounting for inflation. Real return subtracts inflation: if your portfolio earns 8% but inflation is 3%, your real return is approximately 5%. Retirement planning should use real returns to understand actual purchasing power.