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Retirement Planning Calculator

retirement planner icon

Use this retirement planning tool to work out how much you might need to save in order to meet your retirement goals. Based upon the information you provide, this calculator will provide you with a possible forecast savings guide to meet your projected retirement spending. For an explanation of the calculator's reality planning figures vs the traditional planning figures, please see here.

 

Enter your gross yearly income (pre-tax).
  %
Enter the percentage of your current income that you expect to require during retirement. Circumstances do vary. But, below are some general guidelines to help you:

  • Minimum (50% to 60%): Achieves the government's minimum level of financial adequacy (stipulated as 1/2 of pre-retirement income).
  • Basic (70% to 80%): Allows for the fundamentals in retirement, particularly if you have employer-paid retiree health insurance. Your retirement will probably have minimal money available for luxury purchases.
  • Moderate (80% to 90%): This may be required if you will have to pay your own Medicare / health insurance premiums and/or pay for insurance to cover costs above Medicare.
  • Comfortable (90% to 120%): For a retirement lifestyle more luxurious than your current one.
  %
Enter the percentage value that you think inflation will rise, on average, during your retirement years.
A logical long-term projection may be between 2.5% and 5%.

Average Annual Decrease in Spending (%):

  %
National Average: 2.5% Senior Spending Detail
  %
National Average: 2.8% Senior Spending Detail
  years
  years
  years
Enter the age you expect to live to.

If you are fortunate enough to be enrolled in a company-provided pension scheme, enter the annual figure that you expect to receive during retirement. If you are unsure, contact your company's benefit office to obtain this figure.

Enter the annual social security (or state pension) figure that you expect to receive during your retirement. In the US, the social security office sends you a benefit statement each year around the time of your birthday. This statement contains more precise benefit information so you should use this if available. If you do not have a recent statement you can request one from here. Otherwise, you may wish to consider these very general guidelines:
  • If you make under $25,000, enter $8,000
  • If you make between $25,000 - $40,000, enter $12,000
  • If you make over $40,000, enter $14,500
 
Enter the age at which you expect to start receiving your social security benefits. In the US, full benefits are available at age 65 and reduced benefits are available at 62. In the UK, the State Pension age can be between 61 and 68.
  %
Enter the average yearly long-term investment return you expect to earn on your retirement savings. The lower the expected rate, the more you'll need to save to meet retirement income goals. The default is 7%.


 


Processing calculations...

Disclaimer

Whilst every effort has been made in building the retirement planner tool, we are not to be held liable for any special, incidental, indirect or consequential damages or monetary losses of any kind arising out of or in connection with the use of the calculator tools and information derived from the web site. This tool is here purely as a service to you, please use it at your own risk.

The calculations given by the retirement planner tool are only a guide. Please speak to an independent financial advisor for professional guidance. Read the full disclaimer.



Retirement Calculator - Reality Planning vs Traditional Planning

Predicting how much money you might need for retirement can be a tricky task, especially when attempting to extrapolate from current earnings and spending patterns.

Hands holding money for retirement

Analysis of retirement spending data demonstrates that the average household spends less with each passing year - contradicting those calculators that assume that spending levels will simply increase year-on-year with inflation.

The Retirement Planning Calculator takes this detail into consideration when preparing your retirement calculation; providing you with a reality planning figure. The calculator has been developed to forecast (based upon the information you provide about your current situation) an assessment of your retirement spending, together with the savings goals you will need to put in place to meet the requirements. To help you compare, the calculator also provides figures for the more traditional retirement planning method.

As mentioned in the disclaimer, the calculations provided by the retirement planner are only a guide and I always recommend speaking to a qualified financial advisor for professional guidance.


How Much Do I Need For Retirement?

Proper retirement planning is essential if you want to sustain a comfortable lifestyle beyond retirement age. When you're just starting out in your chosen career, it's all too easy to put off thinking about pensions, however the golden rule in retirement planning is: act now.

The oft-quoted calculation for the amount to save for your retirement is to halve your current age and then save that percentage of your gross income, e.g. a 24-year-old should save 12% of their gross income into a pension. This is far better than no pension at all, however, this 'one size fits all' approach fails to take into account many additional factors: what lifestyle you want to have in your retirement years, how active you'll be, where you want to live and if you'll still have a mortgage or dependents.

Read our article about retirement planning or read some ideas for how to start your retirement planning now.

For information relating to the 401(k) pension scheme, take a look at our guide to the 401(k).


If you have any problems using this retirement planning calculator tool then please contact me.