The 4% rule states you can withdraw 4% of your retirement portfolio in the first year, then adjust for inflation each year, and have a high probability of not running out of money over 30 years. It was derived from the 'Trinity Study' (1998) analyzing historical stock/bond portfolio returns. Critics note it may be less reliable in low-return environments.

How much should I save for retirement?

Most financial planners recommend saving 15% of gross income (including employer match) for retirement, starting in your 20s. Common milestones: 1× salary by 30, 3× by 40, 6× by 50, 8× by 60, 10× by 67. The earlier you start, the more compound growth does the work.

What is a realistic retirement investment return?

Historical S&P 500 average: ~10% nominal, ~7% real (inflation-adjusted). A diversified 80/20 stock/bond portfolio historically returns ~7–8% nominal. The calculator uses 7% as the default real return. Adjust based on your risk tolerance and asset allocation.

How does compound interest affect retirement savings?

Compound interest means you earn returns on your returns. $10,000 at 7% per year doubles every ~10 years. After 30 years it grows to ~$76,000 — 7.6× the original. This is why starting early matters enormously: a 25-year-old saving $500/month will have far more at 65 than a 35-year-old saving $1,000/month.

Quick Answer

The 4% safe withdrawal rule says you can withdraw 4% of your portfolio annually in retirement with a high probability of funds lasting 30+ years. To retire on $60,000/year, you need $1.5 million (60,000 ÷ 0.04). Saving $1,500/month from age 30 at 7% average return reaches $1.8M by age 65.

Retirement Calculator

Project how much your retirement savings will grow and what monthly income you can expect.
Includes the 4% withdrawal rule, inflation adjustment, and milestone tracking.

Compound growth · Inflation-adjusted · 4% rule · Savings milestones

Current Age

Retirement Age

Current Retirement Savings

Monthly Contribution

Include employer 401k match

Expected Annual Return

7% = historical S&P 500 real return. Use 5–6% for conservative.

Annual Inflation Rate

How Much Do You Need to Retire?

The answer depends entirely on your expenses. The standard framework is the 4% Rule: multiply your expected annual expenses by 25 to get your target nest egg. Spending $60,000/year in retirement requires $1.5M.

The power of time

At 7% annual return, money doubles every ~10 years. A 25-year-old with $0 who saves $500/month will have more at 65 than a 35-year-old saving $1,000/month. The math favors starting early over saving more.

2026 contribution limits

401(k): $23,500/year ($31,000 if age 50+)
IRA / Roth IRA: $7,000/year ($8,000 if age 50+)
SEP-IRA (self-employed): $70,000 or 25% of compensation
Payroll Taxes Guide
Overtime Rules
Tax Withholding Guide

Max out tax-advantaged accounts before investing in taxable brokerage. The tax savings compound just as powerfully as investment returns.

FAQ

Retirement planning questions

How much do I need to retire?

The 4% Rule: multiply your annual expenses by 25. $50K/year in retirement = $1.25M needed. $80K/year = $2M. This gives you a ~96% historical success rate of not running out of money over 30 years.

What is the 4% withdrawal rule?

In retirement, withdraw 4% of your portfolio in year 1, then adjust for inflation each year. Based on the Trinity Study (1998), this strategy survives 30+ years in ~96% of historical 30-year periods using a 50/50 stock/bond portfolio.

What return rate should I use?

7% is the approximate historical real return of the S&P 500 after inflation. For a diversified 80/20 stock/bond portfolio: ~6–7%. Conservative estimate: 5%. Never use nominal returns without subtracting inflation — real purchasing power is what matters.

How does Social Security affect retirement planning?

Social Security replaces roughly 40% of pre-retirement income for average earners — less for high earners. Full retirement age is 67 for those born after 1960. Claiming at 62 reduces benefits permanently by ~30%; waiting until 70 increases them by ~24%. Use SSA.gov's My Social Security for a personalized estimate.

Retirement Calculator

How Much Do You Need to Retire?

The power of time

2026 contribution limits

Retirement planning questions

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