Retirement Calculator

How This Calculator Works

We calculate two things and add them together: the future value of your current savings (which grows on its own) and the future value of your monthly contributions(which grow as you add them). Both grow at your expected annual return rate, compounded monthly. The 4% rule then estimates how much you could safely withdraw each month in retirement.

Retirement Savings Formula

Where r is the monthly return rate (annual rate ÷ 12) and n is the number of months until retirement. The first term is your savings growing on their own; the second term is the growing annuity of your monthly contributions.

The 4% rule is a widely cited guideline suggesting you can withdraw 4% of your retirement portfolio annually for ~30 years with a low risk of running out of money.

How Compound Growth Works

Compound growth means you earn returns not just on your original savings, but also on the returns those savings generate. Over decades, this effect is dramatic:

Starting 10 years earlier more than triples your investment growth. This is why retirement planning emphasizes time in the market over timing the market.

Example

If you're 30 years old with $50,000 saved and contribute $500/month at 7% return, by age 65 you'll have approximately $1.2 million. Of that, about $290,000 is your own contributions and $910,000 is investment growth. At the 4% rule, that supports roughly $4,000/month in retirement income.

How to Interpret Your Result

• "Total at Retirement" is your projected portfolio value. It is not guaranteed — actual returns vary year to year.
• "Your Contributions" vs "Investment Growth" shows how much of your total comes from your own deposits vs. market returns. The longer you save, the larger the growth share.
• "Monthly Retirement Income" uses the 4% rule. This is a planning estimate, not a promise. Market downturns, inflation, and withdrawal timing all affect actual sustainable income.

Assumptions & Limitations

• Flat return rate: The calculator uses a constant annual return. Real markets fluctuate — some years gain, some lose. A 7% average hides years of +20% and −15%.
• No inflation adjustment: The result is in today's dollars conceptually, but the calculator does not adjust contributions or returns for inflation. At 3% inflation, $1 million in 35 years has the buying power of ~$355,000 today.
• No taxes: The calculator ignores taxes on investment gains. Tax-advantaged accounts (401k, IRA) and taxable accounts have very different after-tax outcomes.
• The 4% rule is a guideline, not a guarantee: It was based on historical US market data (the "Trinity Study"). Future returns may differ.
• This is general information, not financial advice. Consult a qualified financial advisor for personalized planning.

Frequently Asked Questions

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