Calculate how much you need to save for retirement and estimate your retirement income. Plan your financial future with confidence.
A common rule of thumb is to save 10-15% of your income, but this varies based on your age, income, and retirement goals. Use this calculator to determine your specific needs based on your desired retirement lifestyle. Consider factors like your current age, expected retirement age, desired income, and other sources of retirement income.
The 4% rule suggests withdrawing 4% of your retirement savings in the first year, then adjusting for inflation. This is designed to make your savings last 30 years, though market conditions may require adjustments. However, this rule assumes a 30-year retirement and may not be suitable for everyone. Consider your specific circumstances and consult with a financial advisor.
Start as early as possible! Even small amounts saved in your 20s can grow significantly due to compound interest. If you're starting later, you may need to save more aggressively to catch up. The key is to start now, regardless of your age, and increase contributions as your income grows.
Generally, pay off high-interest debt first, but don't completely stop retirement savings. Take advantage of employer matching, then focus on debt payoff, then increase retirement contributions. The exact strategy depends on your debt interest rates, employer matching, and personal risk tolerance.
Inflation reduces the purchasing power of your money over time. When planning for retirement, consider that your expenses will likely increase by 2-3% annually. This means you'll need more money in the future to maintain the same lifestyle. Factor inflation into both your savings growth and your retirement income needs.
Traditional accounts (like 401(k)s) offer tax deductions now but tax withdrawals in retirement. Roth accounts (like Roth IRAs) use after-tax money but offer tax-free withdrawals in retirement. The choice depends on your current tax bracket, expected retirement tax bracket, and personal preferences. Many people benefit from having both types.
Social Security benefits depend on your earnings history, age when you claim, and other factors. You can check your estimated benefits on the Social Security Administration website. Generally, Social Security replaces about 40% of pre-retirement income for average earners, but this varies significantly based on your income level and claiming age.
If you're behind on retirement savings, consider these strategies: increase your contribution rate, work longer, delay Social Security benefits, reduce retirement expenses, or consider a side hustle. The key is to start making changes now rather than waiting. Even small increases in contributions can make a significant difference over time.