Project your savings at retirement, the monthly income they can pay and how long they last. Runs on your device.
The balance at retirement is your savings today grown at the expected return, plus every monthly saving, each grown for the months it stays invested. The page steps month by month: the balance is multiplied by 1 + r and the monthly saving is added at the end of the month, where r is the yearly return turned into a monthly rate, (1 + return)^(1 ÷ 12) − 1. That gives the closed form savings × (1 + r)^n + monthly saving × ((1 + r)^n − 1) ÷ r, with n the number of months. The page opens on a 30-year-old with 50,000 saved, 500 a month, a 6% return and retirement at 65. Over 420 months the balance reaches 1,071,106.33, of which 210,000 is money you paid in. The box How this was worked out writes the formula with your own numbers. Saving stays flat in the model; it does not rise with your pay.
A balance 35 years away buys less than the same number today, so the page also divides it by (1 + inflation)^years. At 2.5% inflation the 1,071,106.33 is worth 451,333.21 at today's prices. The monthly income is the balance times the withdrawal rate, divided by 12: at 4% that is 3,570.35 a month at retirement, or 1,504.44 at today's prices. The 4% figure comes from a 1994 study by William Bengen in the Journal of Financial Planning, which tested a mix of US stocks and bonds against US history. It is a rule of thumb from past data, not a promise, and this page lets you type any rate from above 0 to 20%. After the first year the withdrawal rises with inflation, so what it buys stays the same.
After retirement the page takes the monthly withdrawal at the start of each month, leaves the rest invested at the same return, and raises the withdrawal once a year by inflation. It stops at the age you plan to, or earlier if the balance cannot pay the next withdrawal. On the opening example the balance is still 1,545,078.16 at age 95, so the result reads Past age 95. A higher rate shows the other case: at a 6% withdrawal rate the money lasts to age 89 and 9 months, and at 8% to age 81 and 5 months. With a 0% return and 0% inflation, 10,000 saved plus 100 a month for 10 years makes 22,000, and a 4% withdrawal of 73.33 a month empties it after 25 years. The table lists each year with the amount added or taken out, the growth and the balance.
The return and inflation are constant. Real markets are not, and a bad run just after you retire hurts more than the same average spread evenly, which the page does not show. It has no income tax, capital gains tax, fees, employer match, state or company pension, or government benefit, and it applies no country-specific rule on contribution limits or withdrawal ages. Ages are whole years, from 0 to 100 for retiring and up to 110 for the plan. Use a return after fees. If you expect a pension, work the page with the part you want your savings to cover. Nothing you type is stored or sent. This is an estimate, not financial advice.
balance = savings × (1 + r)^n + monthly saving × ((1 + r)^n − 1) ÷ r, where r is the monthly return and n the number of months. For 50,000 saved and 500 a month over 420 months at 6% a year, r is 0.00486755 and the balance is 1,071,106.33. The page shows these steps with your numbers.
Prices rise, so a future amount buys less. The page divides the balance by (1 + inflation)^years. With 2.5% inflation over 35 years that factor is 2.373205, so 1,071,106.33 becomes 451,333.21. Set inflation to 0% to see the two figures match.
It is the share of the balance at retirement that you take out in the first year, then raise with inflation. At 4% on 1,071,106.33 that is 42,844.25 a year, or 3,570.35 a month. A lower rate gives less income and makes the money last longer.
Set the age you want the money to last to in Plan to age, then read Savings last. With a 6% withdrawal rate the opening example runs out at age 89 and 9 months. If the balance is still above 0 at the plan age, the result says Past age and that age.
No. It uses one return and one inflation rate and adds no tax, fees, pension or benefit, and it has no rules for any country. To include a pension, enter only the monthly income you want your savings to provide, and compare it with the monthly income result.
The numbers you type are processed in your browser and not uploaded. Nothing is saved when you close the page. The page counts visits with Google Analytics, and the amounts you type are not part of that.