Retirement Calculator
Estimate whether your current savings rate will get you to your retirement number.
What this calculator does
Projects your retirement savings balance from your current savings and monthly contributions, then applies the "4% rule" to estimate a sustainable monthly retirement income from that balance.
Who this is for
Anyone building a long-term retirement plan, checking whether their current contribution rate is on track, or wanting a rough sense of what monthly income their eventual balance could support.
How this calculator works
Projects your current balance plus monthly contributions forward using compound growth, then applies the "4% rule" — a common rule of thumb that a portfolio can sustainably support annual withdrawals of about 4% of its value without running out over a ~30-year retirement.
Worked example
$40,000 current savings, $800/month contribution, 25 years to retirement, 7% annual return: the current balance alone grows to roughly $217,000, and 25 years of $800 monthly contributions compounding alongside it add substantially more — landing the total projected balance in the rough vicinity of $850,000-$900,000. Applying the 4% rule: roughly 4% of that balance annually, or about $2,800-$3,000/month in sustainable withdrawal income.
What this result means
The monthly income figure assumes you withdraw 4% of your balance annually, split into monthly payments — it doesn't account for taxes on withdrawals, healthcare cost increases, or how your spending might change across different phases of retirement. Treat it as a starting reference point, not a guaranteed income figure.
Contributions vs. growth at retirement
Run the calculator above to see how much of your retirement balance came from contributions vs. investment growth.
Common mistakes
- Treating the 4% rule as universal. It was designed around a roughly 30-year retirement horizon and historical US market returns — a longer retirement or different market conditions may call for a more conservative withdrawal rate.
- Not adjusting for inflation. A dollar amount today buys less by the time you retire — this calculator shows nominal, not inflation-adjusted, figures.
- Ignoring taxes on withdrawals. Depending on account type (traditional vs. Roth), withdrawals may be taxed, reducing actual spendable income below the figure shown.
- Assuming a flat 7% return every single year. Real returns vary year to year, and the actual sequence of good and bad years (sequence-of-returns risk) matters, especially in the years right before and after retirement.
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Frequently Asked Questions
Why does the order of good and bad market years matter, not just the average?
This is called sequence-of-returns risk — a market downturn in the years right before or after you retire can do much more damage than the same downturn happening mid-career, since you're withdrawing from a shrinking balance rather than adding to a growing one. Two portfolios with the same average return can end up very differently sized depending purely on when the good and bad years occurred.
What is the 4% rule?
A guideline suggesting a retirement portfolio can sustainably support annual withdrawals of about 4% of its starting value without running out over roughly 30 years, based on historical US market analysis. It's a starting reference, not a guarantee.
Does this account for Social Security or pensions?
No, this projects only the portfolio described in the calculator inputs. Social Security, pensions, or other income sources would be additional to the monthly income figure shown.
Is 7% a safe return assumption?
It's a commonly cited long-run average for diversified stock investments, but actual returns vary year to year and aren't guaranteed — consider modeling a more conservative rate for a cautious estimate.