Estimate how much you need to retire and whether you're on track
The 4% rule is a widely used guideline for retirement withdrawals. It says you can safely withdraw 4% of your retirement savings in your first year of retirement, then adjust that amount for inflation each year. Based on historical market returns, this strategy has historically lasted at least 30 years through both bull and bear markets. This calculator uses the 4% rule to estimate how long your savings will last.
Full Retirement Age is the age at which you can receive 100% of your Social Security benefits. If you were born in 1960 or later, your FRA is 67. You can claim benefits as early as age 62, but your monthly check will be permanently reduced by about 30%. If you delay past FRA up to age 70, you earn delayed retirement credits that increase your benefit by about 8% per year. Claiming at 70 gives you the maximum monthly benefit.
A common rule of thumb is that you'll need about 70-80% of your pre-retirement income to maintain your lifestyle in retirement. This calculator defaults to a 70% replacement rate. However, your actual needs depend on your health, where you live, whether your mortgage is paid off, and your travel/leisure goals. Many early retirees find they need 90-100% because they're active and healthy.
Over the long term (20+ years), a diversified stock portfolio has averaged about 7% annual returns adjusted for inflation. This is the default assumption. If you're more conservative (bond-heavy), use 4-5%. If you're aggressive (stock-heavy, early career), you can use 8-9%. Remember that returns fluctuate year to year — sequence of returns risk matters most in the first 10 years of retirement.
Yes, absolutely. The employer match is free money and significantly accelerates your savings. A typical match is 50% of your contributions up to 6% of your salary. If your employer matches 4%, that means you contribute 8% and they add 4%, for a total 12% savings rate. Always contribute at least enough to get the full match — it's an instant 50-100% return.
Inflation erodes purchasing power over time. At 3% annual inflation, prices double about every 24 years. This calculator adjusts for inflation by showing your retirement spending in today's dollars. The projected nest egg is in future (nominal) dollars, while the annual spending figure is in today's purchasing power. Social Security benefits get annual COLA (Cost of Living Adjustments), but most personal savings do not unless you invest in assets that grow with inflation.
The short answer: when your nest egg is large enough that the 4% rule covers your desired spending minus Social Security. This calculator shows you whether you're on track. If the "On Track?" result says "Increase Savings," you can either save more each month, retire later, or adjust your retirement lifestyle expectations. Many Americans find that working just 2-3 years longer dramatically improves their retirement outlook because it delays withdrawals and allows more compound growth.