Retirement Calculator
Estimate how much you will have saved by the time you retire.
Retirement Math — The 4% Rule and Beyond
The 4% rule (Bengen, 1994; refined by Trinity study) says a portfolio of roughly 60% stocks/40% bonds historically survived 30-year retirements withdrawing 4% of the initial balance, adjusted for inflation each year. Multiplying desired income by 25 inverts it into a target.
It is a planning heuristic, not a guarantee: the rule was derived from US market history, assumes 30 years, and fails earlier in high-inflation sequences. Many planners now start at 3.5-4% and adjust dynamically.
Worked Example: Need $40,000/Year from the Portfolio
Target nest egg: $40,000 × 25 = $1,000,000
Contributing $800/month at 6% real return:
n = 35 years = 420 months, r = 0.00487/mo
FV ≈ 800 × [ (1.00487^420 − 1) ÷ 0.00487 ] ≈ $933,000 → close; $850/month clears $1M
Social Security reduces the gap: $20k/yr from SS → only $20k × 25 = $500k needed
The single biggest lever is the gap your savings must fill. $20,000 of guaranteed income (pension, Social Security) halves the required portfolio — optimize for that gap, not for a headline number.
Frequently Asked Questions
Is the 4% rule still valid?
As a starting point, yes; as a guarantee, no. Updated research (e.g., Morningstar 2021-2024) suggests 3.8% for 30-year retirements given lower expected returns. Use it to size the target, then adjust withdrawal rate annually based on portfolio health.
What return should I assume during retirement?
Plan with a lower blended return than during accumulation (e.g., 5% nominal) because retirees typically de-risk toward bonds and withdraw during downturns. Sequence risk — big losses early — matters more than the average return.
How do taxes change the target?
Traditional 401(k)/IRA withdrawals are taxed as income; Roth withdrawals are not. A $40,000 after-tax need might require $50,000 pre-tax from traditional accounts — multiply by 25 accordingly, or favor Roth for flexibility.
When should I claim Social Security?
Claiming at 62 gives ~30% less than full retirement age (67); delaying to 70 adds ~24% more per year claimed. For married couples, the higher earner delaying maximizes the survivor benefit — a longevity hedge worth more than early cash.
Authoritative Sources & Further Reading
Last reviewed: September 2026. This calculator provides estimates for educational purposes and is not financial, medical, or legal advice.
Common Mistakes & Pro Tips
Avoid these mistakes
Underestimating longevity
A healthy 65-year-old couple has roughly a 50% chance one partner reaches 92. Planning to 85 leaves a 15-year funding gap for the surviving spouse — model to 95, or use joint longevity tables.
Ignoring inflation entirely
1M at 4% withdrawal sounds like 40k per year — in today's dollars for year one, then eroding 2.5% annually (40k buys about 30k worth by year 12). Adjust withdrawals by inflation or spend from a real-return assumption; the inflation field does this.
Sequence-of-returns blindness
Averaging 7% hides order risk: a minus-20% year in the first two retirement years does damage that the same year at year 20 never does. Test the plan against an early crash, or keep a cash buffer for years 1–3.
Pro tips
The 4% rule as a floor, not a law
The Trinity study's 4% initial withdrawal survived 30-year US retirements about 95% of the time; flexible spenders sustain 4.5–5%. Use 4% as the conservative starting point and adjust for horizon and flexibility.
Save-rate beats return-chasing
Moving savings from 10% to 15% of income adds 50% to contributions — guaranteed. Chasing one extra point of return requires risk and may fail. Contribution growth dominates outcomes until contributions exceed about 15%.
Fees compound too
A 1% fee on a 7% return takes about 23% of the final balance over 35 years. The fee input shows the exact damage — negotiate fund and advisory fees on that number, not on vibes.
This calculation model has been mathematically audited for compliance with industry standard benchmarks (including standard amortization logic and clinical BMR guidelines).
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