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Formula
Each month B = B × (1 + i) + C, with i = (1 + R)^(1/12) − 1; today's dollars = B ÷ (1 + π)^t; nest egg needed = (income goal − other income) ÷ withdrawal rate
- B
- the savings balance, updated once a month
- C
- the monthly contribution, raised by the yearly increase at the start of each year
- R
- the expected annual return as a decimal (6% = 0.06)
- i
- the monthly return that compounds to R over 12 months
- π
- the expected annual inflation rate as a decimal
- t
- years until retirement (retirement age − current age)
How much do I need to retire?
Most retirement plans come down to two numbers: how much you are likely to have, and how much you need. This retirement calculator works out both and shows the gap between them.
What you will have comes from your current savings and monthly contributions, grown at the return you expect until your retirement age. What you need comes from the income you want in retirement, minus what Social Security and any pension will pay, divided by a withdrawal rate. At the default 4% rate, every $1 of yearly income from savings needs $25 saved.
If the projection falls short, the calculator also tells you the extra amount to save each month, starting now, that would close the gap. The figures are estimates based on your assumptions, not financial advice, and investment returns are never guaranteed.
How to use the retirement calculator
- Enter your current age and the age you plan to retire.
- Enter what you have already saved for retirement and what you add each month, including any employer contributions. If you expect to raise your saving as your pay grows, add a yearly increase.
- Enter an expected annual return and an inflation rate. The calculator uses inflation to state every result in today’s dollars.
- Enter the yearly income you want in retirement in today’s dollars, and your expected Social Security and pension income.
- Keep the 4% withdrawal rate or change it. A lower rate is more cautious and needs a larger nest egg.
The year-by-year table shows your balance at each age in both future dollars and today’s dollars, so you can see when growth starts to outpace your contributions.
How to calculate retirement savings by hand
Take someone aged 45 with $60,000 saved who adds $600 a month, expects a 6% return and 3% inflation, and wants to retire at 65 on $50,000 a year, with $22,000 a year coming from Social Security.
- Years to retirement: 65 − 45 = 20.
- Growth of the current savings: $60,000 × 1.06^20 = $60,000 × 3.207135 ≈ $192,428.13.
- Monthly return: 1.06^(1/12) − 1 ≈ 0.48676%. Growth of $600 a month for 240 months: $600 × ((1.0048676^240 − 1) ÷ 0.0048676) ≈ $272,063.18.
- Savings at 65 in future dollars: $192,428.13 + $272,063.18 = $464,491.31.
- In today’s dollars: $464,491.31 ÷ 1.03^20 = $464,491.31 ÷ 1.806111 ≈ $257,177.58.
- Nest egg needed: ($50,000 − $22,000) ÷ 0.04 = $700,000.
- Shortfall: $700,000 − $257,177.58 = $442,822.42. Saving about $1,763.83 more each month from now would close it.
Entering the same figures in the calculator gives the same results. A shortfall this large is a signal to look at every lever: saving more, retiring later, spending less in retirement or expecting a different return.
Starting age makes the biggest difference
The table shows $500 a month saved from a zero balance until age 65, at a steady 6% return, with 3% inflation.
| Start saving at | Total contributed | Savings at 65 (future dollars) | Savings at 65 (today’s dollars) |
|---|---|---|---|
| 25 | $240,000 | $953,838.88 | $292,405.83 |
| 35 | $180,000 | $487,256.49 | $200,743.22 |
| 45 | $120,000 | $226,719.32 | $125,528.99 |
| 55 | $60,000 | $81,236.72 | $60,447.75 |
Starting at 25 instead of 35 adds $60,000 of contributions but nearly doubles the future balance, because the earliest dollars compound for the longest time. The gap between the two right-hand columns also shows why ignoring inflation makes a long-range projection look far better than it is.
Nest egg needed by withdrawal rate
The nest egg is the yearly income your savings must provide divided by the withdrawal rate.
| Income from savings | 3% rate | 3.5% rate | 4% rate | 5% rate |
|---|---|---|---|---|
| $20,000 a year | $666,667 | $571,429 | $500,000 | $400,000 |
| $40,000 a year | $1,333,333 | $1,142,857 | $1,000,000 | $800,000 |
| $60,000 a year | $2,000,000 | $1,714,286 | $1,500,000 | $1,200,000 |
The 4% figure traces back to a 1998 study by three Trinity University professors that tested withdrawals against historical U.S. stock and bond returns. Rates of 3% to 4% held up well over 30 years in that data, while higher rates failed more often, especially when withdrawals rose with inflation. Past results do not guarantee future ones. To test how long a specific balance would last at a chosen withdrawal, use the retirement withdrawal calculator.
Including Social Security and a pension
Guaranteed income shrinks the nest egg you need. In the hand example above, $22,000 a year from Social Security cuts the required savings from $1,250,000 to $700,000. Enter benefits in today’s dollars; Social Security benefits receive cost-of-living adjustments tied to inflation, so today’s-dollar estimates fit this calculator. Some pensions are not adjusted for inflation, so their real value falls each year; a cautious approach is to enter a little less than the current pension amount.
A simple investing-for-retirement projection
If you just want to know what steady monthly investing could grow to, enter your income goal as a placeholder, set Social Security to 0 and read the projected savings and the year-by-year table. The projection uses the same month-by-month compounding as the compound interest calculator, with the option to raise contributions each year and to see the result in today’s dollars.
Common mistakes
- Mixing future and today’s dollars. An income goal in today’s prices must be compared with savings in today’s prices, which is what the calculator does.
- Using one optimistic return. Try a lower return as well. A plan that only works at a high return is fragile.
- Forgetting taxes. Withdrawals from traditional 401(k) plans and IRAs are generally taxed as income, so a pre-tax income goal needs more savings than the same after-tax spending.
- Treating the 4% rule as a guarantee. It is a starting point for planning. Review your plan every year and adjust if returns or expenses change.
Worked examples
Mid-career saver with Social Security
Age 40 with $85,000 saved, adding $900 a month at a 6% return until 67, with 2.5% inflation. The goal is $70,000 a year, of which $26,000 is expected from Social Security, using a 4% withdrawal rate.
Inputs: Current age = 40 years; Retirement age = 67 years; Current retirement savings = $85000; Monthly contribution = $900; Yearly increase in contributions = 0 %; Expected annual return = 6 %; Expected inflation = 2.5 %; Annual income wanted in retirement = $70000; Social Security and pension income = $26000; Withdrawal rate = 4 %
Years to retirement = 67 − 40 = 27 Each month: balance × (1 + 6%)^(1/12) + contribution → $1,116,643.24 Today’s dollars = $1,116,643.24 ÷ (1 + 2.5%)^27 = $573,284.34 Needed = ($70,000.00 − $26,000.00) ÷ 4% = $44,000.00 ÷ 4% = $1,100,000.00 Gap = $1,100,000.00 − $573,284.34 = $526,715.66; extra saving = $1,025,936.78 in future dollars ÷ growth of $1 a month = $1,306.47 a month
Answer: Saving $900.00 a month from age 40 at a 6% return projects $573,284.34 (today’s dollars) at age 67, against $1,100,000.00 needed: a shortfall of $526,715.66, closed by about $1,306.47 more a month. This is an estimate, not a guarantee.
Starting from zero with rising contributions
Age 25 with nothing saved yet, starting at $350 a month and raising it 3% a year, at a 7% return and 3% inflation, for $55,000 a year with $20,000 from Social Security.
Inputs: Current age = 25 years; Retirement age = 65 years; Current retirement savings = $0; Monthly contribution = $350; Yearly increase in contributions = 3 %; Expected annual return = 7 %; Expected inflation = 3 %; Annual income wanted in retirement = $55000; Social Security and pension income = $20000; Withdrawal rate = 4 %
Years to retirement = 65 − 25 = 40 Each month: balance × (1 + 7%)^(1/12) + contribution, contribution rising 3% a year → $1,268,778.35 Today’s dollars = $1,268,778.35 ÷ (1 + 3%)^40 = $388,952.68 Needed = ($55,000.00 − $20,000.00) ÷ 4% = $35,000.00 ÷ 4% = $875,000.00 Gap = $875,000.00 − $388,952.68 = $486,047.32; extra saving = $1,585,504.71 in future dollars ÷ growth of $1 a month = $437.37 a month
Answer: Saving $350.00 a month from age 25 at a 7% return projects $388,952.68 (today’s dollars) at age 65, against $875,000.00 needed: a shortfall of $486,047.32, closed by about $437.37 more a month. This is an estimate, not a guarantee.
Close to retirement with a pension
Age 58 with $420,000 saved and $1,500 a month for 5 more years at 5%, with a pension and Social Security covering $45,000 of an $80,000 goal, using a more cautious 3.5% withdrawal rate.
Inputs: Current age = 58 years; Retirement age = 63 years; Current retirement savings = $420000; Monthly contribution = $1500; Yearly increase in contributions = 0 %; Expected annual return = 5 %; Expected inflation = 3 %; Annual income wanted in retirement = $80000; Social Security and pension income = $45000; Withdrawal rate = 3.5 %
Years to retirement = 63 − 58 = 5 Each month: balance × (1 + 5%)^(1/12) + contribution → $637,758.86 Today’s dollars = $637,758.86 ÷ (1 + 3%)^5 = $550,136.40 Needed = ($80,000.00 − $45,000.00) ÷ 3.5% = $35,000.00 ÷ 3.5% = $1,000,000.00 Gap = $1,000,000.00 − $550,136.40 = $449,863.60; extra saving = $521,515.21 in future dollars ÷ growth of $1 a month = $7,690.41 a month
Answer: Saving $1,500.00 a month from age 58 at a 5% return projects $550,136.40 (today’s dollars) at age 63, against $1,000,000.00 needed: a shortfall of $449,863.60, closed by about $7,690.41 more a month. This is an estimate, not a guarantee.
Edge case: other income already covers the goal
One year to go with $10,000 saved, a 0% return and 0% inflation, and other income ($40,000) already above the $30,000 goal, so no savings are needed.
Inputs: Current age = 50 years; Retirement age = 51 years; Current retirement savings = $10000; Monthly contribution = $0; Yearly increase in contributions = 0 %; Expected annual return = 0 %; Expected inflation = 0 %; Annual income wanted in retirement = $30000; Social Security and pension income = $40000; Withdrawal rate = 4 %
Years to retirement = 51 − 50 = 1 Each month: balance × (1 + 0%)^(1/12) + contribution → $10,000.00 Today’s dollars = $10,000.00 ÷ (1 + 0%)^1 = $10,000.00 Needed = ($30,000.00 − $40,000.00) ÷ 4% = $0.00 ÷ 4% = $0.00 Surplus = $10,000.00 − $0.00 = $10,000.00
Answer: Saving $0.00 a month from age 50 at a 0% return projects $10,000.00 (today’s dollars) at age 51, against $0.00 needed: a surplus of $10,000.00. This is an estimate, not a guarantee.
Assumptions and limitations
- The expected return is the same every year. Real investment returns vary from year to year, can be negative and are not guaranteed.
- Contributions are added at the end of each month. If you enter a yearly increase, the monthly contribution rises by that percentage at the start of each new year.
- Results in today's dollars divide the future balance by (1 + inflation)^years. Your income goal and Social Security or pension income are entered in today's dollars.
- The nest egg needed is the yearly income your savings must provide divided by the withdrawal rate (4% by default). The withdrawal rate is a planning rule of thumb, not a promise that the money will last.
- The extra monthly saving starts now and rises by the same yearly increase as your contributions.
- Taxes, account fees, employer match limits and early-withdrawal penalties are not modeled. Results are estimates for planning, not financial advice.
Frequently asked questions
How much do I need to retire?
A common starting point is to divide the yearly income your savings must supply by a withdrawal rate. If you want $50,000 a year and expect $20,000 from Social Security, savings must cover $30,000; at a 4% withdrawal rate that is $750,000 in today's dollars. The calculator does this division for you and compares it with your projected savings.
How do you calculate retirement income?
Add up guaranteed income such as Social Security and any pension, then add what your savings can support. At a 4% withdrawal rate, every $100,000 saved supports about $4,000 in the first year of retirement. The result panel shows this total as the yearly income your savings would support.
How do you calculate retirement savings?
Grow your current balance and each monthly contribution at your expected return until your retirement age. The calculator does this month by month, then divides the result by the inflation factor so you can see what it would buy at today's prices.
What rate of return should I use?
Use a figure you consider realistic for your mix of investments, and try a lower one as well. Long-run returns on a diversified portfolio have historically varied widely, and no rate is guaranteed. Running the retirement calculator at two or three return assumptions shows how sensitive your plan is.
Does this calculator include Social Security and pensions?
Yes. Enter your expected yearly Social Security and pension income in today's dollars, and the calculator subtracts it from your income goal before working out the nest egg you need. You can get a personal benefit estimate from the Social Security Administration.
Why are results shown in today's dollars?
A million dollars in 30 years will buy far less than a million dollars today. Dividing the future balance by (1 + inflation)^years turns it into today's purchasing power, so you can compare it fairly with an income goal you think about in current prices. Enter 0% inflation to see the future-dollar figure as the headline instead.
What is the 4% rule?
It comes from research on historical U.S. stock and bond returns, which found that withdrawing about 4% of savings in the first year, then raising the amount with inflation, usually lasted 30 years. It is a rule of thumb, not a guarantee, and a lower rate gives a larger safety margin.
Sources
- Retirement Savings: Choosing a Withdrawal Rate That Is Sustainable — AAII Journal (the Trinity study). Checked October 10, 2026.
- Retirement Estimator — U.S. Securities and Exchange Commission, Investor.gov. Checked October 10, 2026.
- Managing Your Retirement Portfolio — FINRA. Checked October 10, 2026.
- Compound Interest (glossary) — U.S. Securities and Exchange Commission, Investor.gov. Checked October 10, 2026.
- Consumer Price Index — U.S. Bureau of Labor Statistics. Checked October 10, 2026.