See How Much You Need to Retire Comfortably

Personal Finance Insider’s free retirement calculator can show you whether you’re on track for a comfortable retirement.

By providing information including your age, income, savings rate, retirement balances, expected retirement spending, and how long you plan to work, it estimates how much money you’ll have compared with how much you’ll need.

How to use the retirement calculator

For this calculator, we define a comfortable retirement as being able to live on 70% of your pre-retirement income. However, the calculator is customizable.

Here’s what you’ll need to input:

• Personal information: Current age and the age at which you expect to retire.
• Current retirement balance: The total amount of retirement savings you have across all your accounts, including 401(k)s and IRAs.
• Current household income: Your annual gross income (the amount you earn before taxes).
• Rate of Savings: How much money you save toward retirement each month. You can enter this as a dollar amount or a percentage of your income.

The following inputs are pre-filled, but you can change some of them to further customize your retirement calculation.

• Expected Annual Salary Increases: The calculator’s default is 2%.
• Anticipated monthly spending in retirement: We assume you’ll spend 70% of your pre-retirement income (the amount you’re projected to be earning right before you retire), but you can change that number if you expect to spend more or less.
• Life expectancy: The default calculation uses a life expectancy of 100 years.
• Investment returns: We assume your savings are invested and earn a 5% annual rate of return.

How a retirement calculator can help

Our retirement calculator is designed to track your progress toward retirement. It’s based on a rule of thumb that Americans spend less as they age and can therefore sustain a 30- to 40-year retirement on 70% of their pre-retirement income.

The calculator generates two important numbers:

1. The amount you will have by your desired retirement age. By providing your current savings rate and retirement account balances, we’re able to estimate how much money you’ll have in savings or investments by retirement.
2. The amount you will need by your desired retirement age. Using your current income and expected salary increases, we’re able to estimate how much money you’ll need in savings or investments by retirement.

Using a retirement calculator to see where you stand provides several benefits.

• Snapshot of your future: A rough estimate of how much money you’ll need to retire by a certain age is better than having no estimate at all.
• Identify shortfalls: The calculator shows if you might fall short of your financial goal, giving you the opportunity to plan for a higher savings rate or find sources of supplementary income.
• See your options: By adjusting the calculator’s inputs — such as changing your savings rate or your planned retirement age — you can see how your overall plan is affected.

What to do if you’re behind in retirement savings

If the retirement calculator shows you falling short of your financial target, don’t be discouraged. There’s still time to make adjustments to your savings rate or investment strategy to get closer to meeting your goal.

One of the most effective ways to catch up on retirement savings is to increase your income. A nationwide labor shortage has given workers significant negotiating power. According to FlexJobs’ Work Insight 2022 survey, 47% of employees who asked for a raise in 2021 year were successful.

If you’re unable to score a raise in your current position, consider switching jobs for a higher salary or better benefits, such as a more generous 401(k) match or access to stock options.

Above all, be flexible. As you approach retirement, consider taking a part-time job, waiting to claim Social Security benefitsdownsizing your home, or relocating to a more affordable city.