Retirement Calculator

Method & sources

This calculator is educational, not advice. It projects a retirement savings outcome from the numbers and assumptions you enter; it is not financial, investment or tax advice. Actual results will differ from any projection. Confirm your own plan with a qualified financial advisor.

Formula

Pre-retirement growth: your current retirement savings compound at the entered pre-retirement rate of return for every year between your current age and your desired retirement age (future value of a lump sum).

Your annual contribution (a dollar amount, or a percentage of current income converted to a dollar amount) is treated as a level end-of-year payment growing at the same pre-retirement return rate (future value of an ordinary annuity), and added to the grown savings to get your total projected savings at retirement.

A 'real' (inflation-adjusted) post-retirement rate of return is calculated as (1 + post-retirement return) / (1 + inflation) - 1.

Your desired annual retirement income (a dollar amount, or a percentage of current income) is inflated forward, year by year, to the year you retire, to get the income you'll need in your first year of retirement.

If you choose to include Social Security, its annualized monthly benefit is subtracted from that first-year income need; the net annual need is then converted into a lump sum ('nest egg needed') as the present value of an annuity due - payments at the start of each year of your expected retirement - discounted at the real post-retirement rate.

Special case: if the real post-retirement rate is within 0.01 percentage points of zero (post-retirement return roughly equal to inflation), the calculator instead uses nest egg needed = (first-year income need - Social Security, floored at zero) x years in retirement - the algebraic limit of the general formula above, used for numerical stability near a zero real rate.

Shortfall or surplus = total projected savings at retirement - nest egg needed.

If there is a shortfall, the calculator solves for the level additional annual savings (contributed at the pre-retirement return rate over the years until retirement) that would close that exact gap by retirement age.

Rounding

All dollar results (nest egg needed, projected savings, shortfall/surplus, additional savings needed) are rounded to the nearest whole dollar for display. Every internal calculation (compounding, annuity, annuity-due, payment) is done in unrounded floating point before that final rounding - intermediate steps are never rounded.

Inputs used

• Current age and desired retirement age, and life expectancy (all in years) - retirement age must exceed current age, and life expectancy must exceed retirement age
• Current annual income ($)
• Desired annual retirement income - entered as either a dollar amount or a percentage of current income
• Current retirement savings ($)
• Annual contribution - entered as either a dollar amount or a percentage of current income
• Whether to include Social Security, and if yes, an estimated monthly benefit ($)
• Expected rate of return before retirement (%)
• Expected rate of return after retirement (%)
• Expected annual inflation rate (%)
• None of these fields are pre-filled: every input is required and shows only a placeholder example (e.g. 'e.g., 7'), so nothing is silently assumed on your behalf - you must type every value yourself, including both rates of return and the inflation rate.

What this does not account for

• Taxes: withdrawals are not adjusted for ordinary income tax (traditional accounts) or tax-free treatment (Roth); every dollar is treated as fully spendable as entered.
• Sequence-of-returns risk: both the pre- and post-retirement rates of return are flat, single assumed figures applied every year, not year-to-year market volatility - a bad run of returns early in retirement is not modeled.
• Variable spending in retirement: assumes one steady, inflating income need every year rather than higher spending early in retirement (travel, etc.) tapering off later, or a spike from a late-life healthcare event.
• Longevity risk beyond your life-expectancy input: the plan is only sized to last exactly the years-in-retirement you enter; nothing accounts for living longer than that.
• Social Security cost-of-living adjustments: your entered monthly Social Security benefit is treated as a flat nominal amount and is not itself inflated further in the year-by-year chart, only your desired income figure is.
• Employer 401(k) matching, IRS contribution limits, and age-50-plus catch-up contributions - your annual contribution is a single blended figure with no plan-specific rules applied.
• Investment fees or expense ratios, which reduce real-world returns below any assumed flat rate.
• Account type differences (401(k), Traditional IRA, Roth IRA) and Required Minimum Distributions, which this tool does not distinguish between.

Jurisdiction

United States. Uses U.S.-style tax-deferred/tax-free retirement account framing (401(k), IRA) and U.S. Social Security as the optional income offset; the underlying math (compound growth, annuities) is not itself jurisdiction-specific.

Source

Consumer Financial Protection Bureau, "How does compound interest work?"

Effective date

General time-value-of-money mathematics; not tied to a specific tax year or regulatory table.

Version

1.1

Last substantive review

2026-09-20

Limitations

• Fixed 2026-09-20 (FCH-ISS-25): when the post-retirement return rate is within 0.01 percentage points of the inflation rate (real return approx 0%), the calculator uses a simplified nest-egg formula (net income need x years in retirement) for numerical stability, since the general formula divides by a near-zero rate. That simplified branch used to skip subtracting your entered Social Security benefit, unlike the normal case a few lines away - anyone who entered equal post-retirement-return and inflation figures with Social Security included saw a nest-egg figure inflated by the full value of that income. Now subtracts it, matching the general formula's own behaviour at exactly zero.
• This is not a substitute for a licensed financial planner or the projection tools offered by your own retirement plan provider.
• No single authoritative regulatory source documents this exact combined formula (compound accumulation plus inflation-adjusted drawdown with a Social Security offset) the way the IRS documents RMD factors; the cited CFPB page documents the general compounding mechanism the accumulation phase relies on, and the withdrawal-phase math is standard, textbook time-value-of-money mathematics (present value of a growing annuity due).
• Assumes a single, unchanging annual contribution amount (or percentage of current income) every year until retirement - it does not model raises, career breaks, or lump-sum additions.
• The 'additional savings needed' figure is a pure arithmetic solve with no check against real-world contribution limits or cash-flow feasibility.

Reference cases

Five worked examples you can check by hand against the formula above.

Change log