Retirement Planning Calculator

Retirement planning comes down to two numbers and the gap between them. The first is your projected nest egg — what your current savings and ongoing contributions will grow to by the day you stop working. The second is your required corpus — the pot you actually need to fund the lifestyle you want. This calculator computes both, then shows whether you are on track with a surplus or facing a shortfall.

The accumulation side uses a standard future-value model; the target side uses the safe-withdrawal rate (the famous 4% rule), inflating today's desired income to your retirement date before dividing by your chosen withdrawal rate.

Your savings grow month by month at one-twelfth of the expected annual return:

i = return / 12  ·  n = months to retirement

• Current savings: FV = currentSavings × (1 + i)ⁿ
• Monthly contributions (ordinary annuity): FV = contribution × [((1 + i)ⁿ − 1) / i]
• Projected nest egg: the two added together.

At a 0% return the annuity factor becomes its limit (contribution × n), so the projection is simply everything you put in. Total contributions are your starting savings plus every monthly deposit; the interest earned is the projected nest egg minus that.

The 4% rule says a balanced portfolio can sustain withdrawals of 4% of its starting value, rising with inflation, for about 30 years. Flip that around and the corpus you need is your first-year spending divided by the withdrawal rate:

spend at retirement = desired income × (1 + inflation)^years
required corpus = spend ÷ withdrawal rate

At a 4% withdrawal rate that is 25 times your first-year spending — the "25× rule". The key subtlety is inflation: $50,000 of spending today is far more in nominal dollars 35 years from now, which is why the target is so much larger than the income figure you enter.

The table below comes from the same engine that powers the calculator above — $25,000 in savings today plus $500 a month at 7% a year, compounded monthly until age 65. It shows every fifth year so you can watch growth overtake contributions as the balance compounds.

By 65 the nest egg reaches about $1.19 million from $235,000 contributed — roughly $953,000 of it is pure compound growth. But with $50,000 of desired income inflating at 3% to about $140,700 a year, the 4% rule asks for a corpus of about $3.52 million — a sizeable shortfall that points to saving more, working longer, or trimming the target.

The 4% rule was calibrated for a roughly 30-year retirement. A longer horizon needs a lower rate (a bigger corpus); a shorter one can support more. Here is the required corpus for the example's inflated spending across common rates:

Dropping from 4% to 3% raises the required corpus by a third — the cost of insuring a longer or more cautious retirement. Use your life expectancy to judge: the further it is from your retirement age, the lower the rate you should pick.

This site has two retirement tools that answer the same question with different methods. This one leads with the simple, widely-cited 4% / 25× rule. The other models the draw-down years explicitly with a present-value annuity and a post-retirement return rate, which is usually more conservative.

Neither is "right" — they bracket the answer. If both agree you are on track, you have a robust plan; if they disagree, the truth is somewhere between, and it is worth a conversation with a financial adviser.

Three widely-used rules of thumb give a quick sense of whether you are on the right track before running detailed numbers:

• 10–15% rule: Set aside 10–15% of your gross income each year for retirement. Starting at 25 with consistent contributions at this rate typically builds a seven-figure nest egg by conventional retirement age, assuming a diversified portfolio.
• 80% replacement rule: Plan to replace 70–80% of your pre-retirement income. Work-related costs — commuting, professional clothing, payroll taxes — shrink in retirement, so most people need less than their full working income to maintain their standard of living.
• 25× / 4% rule: The required corpus equals 25 times your first-year retirement spending (the reciprocal of a 4% withdrawal rate). This is the headline method this calculator uses for the corpus target.

These rules describe averages and starting points — not prescriptions. Your actual number depends on your lifestyle, health, debt, and other income sources. Use them to sense-check the inputs you enter above.

Your portfolio is rarely the only income source in retirement. Most retirees draw from several streams, and knowing what you can count on lets you enter a more accurate net gap into the calculator.

• Social Security / state pension: A government benefit funded by payroll contributions throughout your working life. In the US, Social Security is designed to replace roughly 40% of pre-retirement income for average earners; higher earners replace a smaller percentage. Claiming later (up to age 70) increases the monthly benefit.
• Employer-sponsored plans (401k, 403b, EPF, NPS): Workplace defined-contribution plans that accumulate over your career, often with an employer match. These are the primary savings vehicle for most salaried workers and should be the first account you maximize before taxable investing.
• Individual retirement accounts (IRA / PPF / RD): Personal tax-advantaged accounts that supplement employer plans. Traditional accounts defer tax to withdrawal; Roth-style accounts use after-tax contributions for tax-free growth.
• Defined-benefit pension: A guaranteed monthly payment from a former employer or government service, calculated on years of service and final salary. These provide predictable income but are increasingly rare in private-sector employment.
• Annuities: Insurance products that convert a lump sum into a stream of periodic payments — either immediately or deferred. They transfer longevity risk to the insurer, at the cost of giving up control of the capital.
• Passive income and home equity: Rental income, dividends, royalties, or a reverse mortgage can supplement withdrawals from your portfolio and reduce how much your nest egg needs to fund.

For the calculator above, subtract any guaranteed annual income (Social Security, pension, rental) from your desired income before entering the remainder as your target. The tool only models the corpus your personal savings must provide.

The figures are gross and pre-tax, at fixed assumed rates. They ignore taxes on withdrawals, account and fund fees, market volatility, and sequence-of-returns risk — a poor run of returns just after you retire can deplete a nest egg faster than the average suggests. They also assume steady monthly contributions with no career breaks, windfalls or step-ups. Treat the result as a planning guide, not a guarantee, and not financial advice.