Retirement Calculator
The 80% rule is lazy. Calculate what you actually need based on your planned spending, healthcare costs, and lifespan.
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These calculators provide estimates for educational purposes only. Results are not guaranteed and should not be treated as financial advice. Always consult a qualified professional before making major financial decisions.
The 4% rule is a historical guideline for 30-year retirements. If you retire early, you may need your money to last 40+ years, which suggests a lower withdrawal rate. At 3.5% on a $1.5M portfolio, you get $52,500/year. At 4%, you get $60,000/year. The trade-off is more spending now vs. more safety later.
Read more - how it works, tips & FAQs
How to use this calculator
- Enter your current age, desired retirement age, and life expectancy to define your timeline.
- Input your current savings, monthly contributions, and expected annual return rate.
- Add your expected annual spending in retirement (in today's dollars) -- be realistic about healthcare.
- See if your savings last to 95 or if you run out. Adjust contributions or spending until the plan holds.
How to calculate this by hand
FV = P(1+i)^N + PMT × [((1+i)^N – 1) / i], where i = annual return ÷ 12, N = years × 12
FV = future portfolio value, r = expected annual return (e.g., 0.07), n = years until retirement. The first part grows existing savings; the second grows future contributions. The 4% rule is a historical retirement-planning guideline suggesting you can withdraw 4% of FV per year with high confidence of not running out over 30 years. Actual safe withdrawal rates depend on market conditions, inflation, and longevity.
Worked example: $50,000 saved, $500/month for 30 years at 7%
- Monthly rate: 0.07 ÷ 12 = 0.005833
- Total periods: 30 × 12 = 360 months
- Existing savings compounded: $50,000 × (1.005833)^360 ≈ $405,825
- Monthly contributions (end-of-month): $500 × [((1.005833)^360 – 1) ÷ 0.005833] ≈ $609,986
- Total: $405,825 + $609,986 ≈ $1,015,811
- 4% annual withdrawal ≈ $40,632/year ($3,386/month)
Answer: Approximately $1,016,000 at retirement from $50,000 initial plus $500/month at 7% over 30 years.
What $1,000/month from 30 to 65 Gets You
- Starting at age 30 with $10,000 saved
- Contributing $1,000/month for 35 years
- 7% average annual return
- Total contributions: $430,000
- Portfolio at 65: $1,890,000
- 4% withdrawal: $75,600/year in retirement
Result: $430,000 in contributions grows to $1.89M -- enough for $75K/year in retirement. Delay starting to 40, and the same $1,000/month only gets you $880K.
Tips
- Save 15-20% of your income starting in your 20s: Every $1 saved at 25 is worth $16 at 65 (at 7% return). The same $1 saved at 45 is worth $3.90. The first decade of your career is the most powerful savings window you will ever have.
- Use tax-advantaged accounts first: Max your 401(k) match (free money), then Roth IRA, then back to 401(k). A married couple saving in Roth accounts can withdraw $100K+/year tax-free in retirement.
- Plan for healthcare costs separately: A 65-year-old couple retiring in 2026 can expect $350,000 in lifetime healthcare costs including Medicare premiums. Save in an HSA during your working years -- it is triple tax-advantaged.
- Stress-test with a 3.5% withdrawal rate: The 4% rule works for 30-year retirements. If you retire early or want a margin of safety, use 3.5%. On a $1.5M portfolio, that is $52,500/year vs. $60,000 -- a $7,500 gap that buys decades of safety.
Common mistakes to avoid
- Using the 80% income replacement rule - The 80% rule ignores that most retirees spend less on commuting, work clothes, and saving -- but more on healthcare and travel. Calculate your actual spending, not a percentage of income.
- Not accounting for inflation - $50,000 today will be worth $28,000 in 25 years at 2.5% inflation. Always model retirement spending in today's dollars and let the calculator inflate it forward.
- Retiring with too much mortgage - Entering retirement with a $2,000/month mortgage payment on a $4,000/month Social Security income is a crisis waiting to happen. Aim to pay off housing before retirement.
FAQ
Can I retire on $1 million in 2026?
At 4% withdrawal, $1M generates $40,000/year. With Social Security ($24,000/year for a typical worker), total income is $64,000/year. For most people outside high-cost cities, yes -- but healthcare costs are the wildcard.
What is the safest withdrawal rate for early retirement?
For retirements lasting 40+ years, historical studies suggest 3.5% or lower. On a $1.5M portfolio, 3.5% gives $52,500/year. The trade-off is less spending for more safety. Actual results depend on market conditions, inflation, and longevity.
How does Social Security factor into my retirement plan?
The average Social Security benefit in 2026 is $1,900/month ($22,800/year). If you delay to 70, it is $2,700/month ($32,400/year). Treat it as longevity insurance, not your primary income.
Related resources
- Retirement Calculator Guide - Learn how to calculate your real retirement savings target.