Retirement Savings Calculator
Planning for retirement? Enter your current age, retirement age, savings, and monthly contributions to see how much you'll accumulate by the time you retire.
How Much You Need to Retire
Most financial planners suggest you need 70-80% of your pre-retirement income to maintain your lifestyle. If you earn $100,000 before retirement, plan for $70,000-$80,000 per year after. Social Security covers some of this, but most people need substantial savings to fill the gap.
The 4% rule offers a quick estimate. Multiply your desired annual income by 25. Want $60,000 per year? You need $1.5 million saved. Withdraw 4% annually and your savings should last 30 years, adjusted for inflation.
This is a rough guideline, not a guarantee. Market performance, health care costs, and longevity all affect how long your money lasts. Conservative planners use 3% or 3.5% for early retirees or those with 40+ year horizons.
The Power of Starting Early
Time is your greatest asset when saving for retirement. A 25-year-old who saves $300 per month until 65 at 7% return will have about $719,000. A 35-year-old who saves $500 per month until 65 will have about $611,000. The younger saver contributes $36,000 less but ends up with $108,000 more.
This is compound interest at work. The earlier contributions have 40 years to grow instead of 30. Each year of delay costs you exponentially more. Waiting even five years to start can mean needing to double your monthly contribution to catch up.
If you're starting late, don't despair. Increase your savings rate as your income grows. Many people can save 15-20% or more in their peak earning years. Catch-up contributions for those 50 and older let you contribute an extra $7,500 to 401(k)s and $1,000 to IRAs annually.
Maximizing Retirement Account Growth
Where you save matters as much as how much. Tax-advantaged accounts like 401(k)s and IRAs grow tax-free or tax-deferred. A traditional 401(k) reduces your taxable income now, while a Roth IRA gives you tax-free withdrawals in retirement.
Always get the full employer match on your 401(k). If your employer matches 50% of the first 6% you contribute, that's an instant 50% return. No investment can guarantee that. Max out the match before contributing anywhere else.
After the match, prioritize Roth IRAs for their flexibility and tax-free growth. Then return to max out your 401(k). High earners should also consider backdoor Roth conversions and mega backdoor Roth strategies. The more you shelter from taxes, the faster your wealth compounds.
Frequently Asked Questions
How much should I have saved for retirement?
A common rule is 10-12 times your annual income by retirement. If you earn $80,000, aim for $800,000 to $1 million saved.
What's a realistic investment return?
Stock market index funds have averaged 7-10% annually long-term. Conservative portfolios return 4-6%. Use 7% for a balanced estimate.
Should I max out my 401(k)?
At minimum, contribute enough to get the full employer match. Ideally, max it out ($23,000 in 2024 under age 50) before funding taxable accounts.
When should I start saving for retirement?
As early as possible. Thanks to compound interest, starting at 25 versus 35 can mean hundreds of thousands more by retirement even with the same monthly contribution.
Does this account for inflation?
No. Use a conservative return estimate (5-6% instead of 7-8%) to approximate real purchasing power after inflation.