How is the projected balance at retirement calculated?

The projected balance compounds your current savings and monthly contributions at the expected annual return rate over the years until retirement. The formula accounts for monthly compounding of both existing savings and new contributions.

What is the inflation-adjusted balance?

The inflation-adjusted balance converts your projected nominal retirement balance into today's purchasing power by dividing it by the cumulative inflation factor over the accumulation period. It shows what your projected balance is worth in current dollars.

What is the 4% safe withdrawal rate (SWR)?

The 4% rule is a widely used retirement guideline suggesting you can withdraw 4% of your portfolio in the first year of retirement, then adjust for inflation annually, with a high probability your savings will last 30 years. The SWR target shows how large your portfolio needs to be to cover your desired spending using this rule.

How is the SWR monthly income calculated?

The SWR monthly income is 4% of your projected balance divided by 12. It represents the monthly income you could sustainably draw from your portfolio in retirement without depleting it too quickly.

What annual return rate should I use?

A commonly used long-term average for a diversified stock portfolio is around 7% (after inflation) or 10% nominal. Conservative portfolios closer to retirement may use 4–5%. The right rate depends on your asset allocation and risk tolerance.

Does this calculator account for Social Security or pensions?

No, this calculator focuses on personal savings and investment growth. You should add any expected Social Security benefit or pension income on top of the SWR monthly income when planning your retirement budget.

Retirement Calculator

Overview

Calculate your projected retirement balance, inflation-adjusted savings target, and safe withdrawal rate estimate to plan a secure retirement.

The Retirement Calculator helps you project how your savings will grow by retirement, estimate the inflation-adjusted amount you need, and determine what monthly income you can safely withdraw using the 4% rule. Enter your current age, retirement age, existing savings, monthly contributions, expected return, inflation rate, and target monthly spending to get a comprehensive retirement plan.

How to use

Plan your retirement in a few simple steps.

Enter your current and retirement age: Input your current age and the age at which you plan to retire to calculate your accumulation period.
Add your current savings and contributions: Enter your existing retirement savings balance and how much you plan to contribute each month.
Set expected return and inflation rates: Enter your expected annual investment return (e.g. 7%) and an assumed annual inflation rate (e.g. 2.5%).
Enter your target monthly spending: Specify how much you expect to spend per month in retirement in today's dollars.
Review your retirement projection: Check your projected balance at retirement, the inflation-adjusted value in today's dollars, the savings target based on the 4% safe withdrawal rule, and the estimated monthly income your portfolio can support.

FAQs

How is the projected balance at retirement calculated?: The projected balance compounds your current savings and monthly contributions at the expected annual return rate over the years until retirement. The formula accounts for monthly compounding of both existing savings and new contributions.
What is the inflation-adjusted balance?: The inflation-adjusted balance converts your projected nominal retirement balance into today's purchasing power by dividing it by the cumulative inflation factor over the accumulation period. It shows what your projected balance is worth in current dollars.
What is the 4% safe withdrawal rate (SWR)?: The 4% rule is a widely used retirement guideline suggesting you can withdraw 4% of your portfolio in the first year of retirement, then adjust for inflation annually, with a high probability your savings will last 30 years. The SWR target shows how large your portfolio needs to be to cover your desired spending using this rule.
How is the SWR monthly income calculated?: The SWR monthly income is 4% of your projected balance divided by 12. It represents the monthly income you could sustainably draw from your portfolio in retirement without depleting it too quickly.
What annual return rate should I use?: A commonly used long-term average for a diversified stock portfolio is around 7% (after inflation) or 10% nominal. Conservative portfolios closer to retirement may use 4–5%. The right rate depends on your asset allocation and risk tolerance.
Does this calculator account for Social Security or pensions?: No, this calculator focuses on personal savings and investment growth. You should add any expected Social Security benefit or pension income on top of the SWR monthly income when planning your retirement budget.