Retirement Planner Calculator

A commonly used benchmark is 7% per year, which reflects the long-run average real return of a broadly diversified U.S. stock market index fund after accounting for inflation. Some planners use a more conservative 5–6% to build in a margin of safety, while aggressive growth portfolios may assume 8–10%. The right figure depends on your asset allocation — a portfolio holding a mix of stocks and bonds will typically project lower returns than an all-equity portfolio. This calculator defaults to 7% as a reasonable middle-ground estimate. Adjust it to reflect your actual investment strategy.

Compound growth means you earn returns not just on the money you contribute, but on all the growth that has already accumulated. Each year, your entire balance — contributions plus prior gains — earns a return. Over long horizons this creates an exponential curve: a 30-year-old who invests $500 per month at 7% will accumulate roughly $567,000 by age 65, but only $132,000 came from their own contributions — the remaining $435,000 is pure compounding. Starting even five years earlier dramatically amplifies this effect, which is why time in the market is often more powerful than the size of individual contributions.

The 4% rule is a widely cited retirement spending guideline suggesting that you can withdraw 4% of your portfolio in the first year of retirement, then adjust that amount for inflation each subsequent year, with a high probability of not running out of money over a 30-year retirement. It implies you need roughly 25 times your desired annual spending in savings to retire comfortably (the 'rule of 25'). For example, if you plan to spend $60,000 per year, you'd target a $1,500,000 portfolio. The rule originated from the Trinity Study and is a useful starting point, though actual withdrawal rates should be personalized based on your spending, health, and portfolio composition.

This calculator uses a nominal return rate — the raw percentage your investments grow before inflation is subtracted. If you enter 7%, that is the nominal return, and the projected balance will be in future dollars (which buy less than today's dollars due to inflation). To get inflation-adjusted projections, you can enter a real return rate by subtracting expected inflation from your nominal rate. For example, if you expect 7% nominal returns and 3% inflation, enter 4% as your return rate. The resulting projected balance will then be expressed in today's purchasing power. Both approaches are valid — just be consistent when setting your retirement goal.

A 401(k) is an employer-sponsored plan with higher annual contribution limits ($23,500 in 2025, plus $7,500 catch-up contributions for those 50 and older) and often includes employer matching contributions — effectively free money. An IRA (Individual Retirement Account) is opened independently with lower limits ($7,000 per year in 2025) but offers more investment choices. Both come in Traditional (pre-tax contributions, taxable withdrawals) and Roth (after-tax contributions, tax-free withdrawals) varieties. A common strategy is to contribute enough to a 401(k) to capture the full employer match, then max out a Roth IRA, then return to the 401(k) for additional contributions.

A common rule of thumb is to save 10–15% of your gross income for retirement, including any employer contributions. However, the right number depends heavily on when you start, your retirement lifestyle goals, expected Social Security income, and investment returns. Earlier starters can save less per month due to compounding; later starters need to save more aggressively to catch up. This calculator lets you experiment directly: enter your current savings, monthly contribution, and expected return to see the projected outcome — or enter a retirement goal and it will calculate exactly how much you need to save monthly to reach it.