How much do you need in retirement, and how much do you need to save now so that you can have the type of retirement you want? We've put together this tool to help you visualize how much to save and what your finances might look like once you retire.
To use the retirement calculator, manually enter the values or use the sliders to change the values.
You will need a month after you retire.
You will recieve from Social Security, and your retirement investments will pay a month.
That will leave you with a shortfall of a month.
What do these retirement calculator results mean?
While the results above are strictly hypothetical, they give you an estimate of expected annual cash flow during your retirement years. There are many important factors to consider when planning for your retirement, but this information will help you get started.
Default income replacement rate
Although everyone is different, as a general rule most people require approximately 80% of their income before retirement to maintain their current lifestyle. So if you make $50,000 a year immediately before retirement, you will need approximately $40,000 a year in retirement. The reason your required income tends to go down in retirement is that you're no longer incurring the costs of working (gas prices, dry cleaning, etc.), your tax bill is generally lower, your house may be paid for, and your children may no longer require financial support.
Source: Coming of age: toward a national retirement income policy / President's Commission on Pension Policy, President's Commission on Pension Policy
Replacement ratio findings
Average Rate of Return
Returns vary greatly depending on asset allocation and other factors. A portfolio fully invested in U.S. stocks from 1926 to 2016 grew an average of 9.9% per year while a portfolio of 10-year U.S. government bonds grew approximately 5.2%. Past performance is not a guarantee of future returns.
We assume you will retire at age 65