Free retirement calculator. Find out how large a nest egg you need using the 4% withdrawal rule, and whether your current savings and contributions are on track.
A retirement calculator sizes the nest egg you need using the safe withdrawal rate: Required Nest Egg = Target Annual Income / Withdrawal Rate (commonly 4%). It then projects your current savings and monthly contributions forward to your retirement age to show whether you're on track or facing a shortfall.
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You're on track — projected surplus
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Retirement Calculator
The most common way to size a retirement goal is to work backward from how much annual income you'll want, using a safe withdrawal rate. If you want $40,000 a year and plan to withdraw 4% of your portfolio annually, you need a nest egg of $40,000 / 0.04 = $1,000,000.
The 4% Rule
The 4% rule originates from historical research (the "Trinity study") testing how various withdrawal rates would have performed across 30-year retirement periods using historical US stock and bond returns. A 4% starting withdrawal rate, adjusted for inflation each subsequent year, had a high historical success rate of not depleting the portfolio.
It's a planning heuristic, not a law of finance — actual safe withdrawal rates depend on your specific retirement length, portfolio mix, market conditions at retirement, and risk tolerance. Some conservative planners use 3-3.5% instead, requiring a larger nest egg for the same income.
Closing the Gap
Your projected nest egg comes from two sources growing in parallel: your current savings compounding at your expected return, and your ongoing monthly contributions building up over time (also compounding). This calculator projects both separately, then combines them to compare against your required nest egg.
If there's a shortfall, the calculator shows exactly how much you'd need to contribute monthly, from today until your target retirement age, to close it — assuming your expected rate of return holds.
Related Calculators
For related financial planning, see our compound interest calculator, savings goal calculator, and SIP calculator.
Practical Use Cases
Retirement planning check-in
Getting a yearly snapshot of whether you're on track for your target retirement age.
Career change decisions
Understanding how a salary change or career break affects your retirement timeline.
Early retirement (FIRE) planning
Testing how an earlier retirement age changes your required savings rate.
Contribution rate adjustments
Finding the exact monthly contribution needed to close a projected shortfall.
Comparing withdrawal strategies
Seeing how a more conservative withdrawal rate (e.g. 3.5% vs 4%) changes your target nest egg.
Using the safe withdrawal rate: Required Nest Egg = Target Annual Income / Withdrawal Rate. For example, wanting $40,000/year in retirement with a 4% withdrawal rate requires a $1,000,000 nest egg ($40,000 / 0.04).
The 4% rule is a widely-cited guideline suggesting that withdrawing 4% of a retirement portfolio's value in the first year, then adjusting for inflation each year after, has historically had a low risk of depleting the portfolio over a 30-year retirement. It's a starting point, not a guarantee — some planners now suggest more conservative rates (3-3.5%) for longer retirements.
This depends on your investment mix. A diversified stock/bond portfolio has historically returned around 6-8% annually before inflation over long periods, though returns vary significantly year to year and are never guaranteed.
The target annual income you enter should already be in today's purchasing power terms. This calculator does not separately model inflation between now and retirement — for a more conservative estimate, consider entering a higher target income to account for rising costs over time.
The calculator shows the monthly contribution needed to close the gap by your target retirement age. If that amount isn't feasible, consider working a few years longer, reducing your target retirement income, or increasing your savings rate gradually over time.