What the retirement calculator shows
The retirement calculator does two things at once. First, it projects your nest egg at the retirement age you pick — your starting savings plus monthly contributions, compounded at your expected annual return. Second, it converts that nest egg into two rough monthly withdrawal estimates: one using the famous "4% rule" and one using a straight annuity-style depletion over your expected lifetime. Both update live so you can see how saving more, working longer or assuming a different return changes the picture.
The math behind the projection
Accumulation phase:
- Starting savings FV: P × (1 + r/12)12 × t
- Contributions FV (ordinary annuity): PMT × [((1 + r/12)12 × t − 1) ÷ (r/12)]
- Where P = current savings, PMT = monthly contribution, r = annual return decimal, t = years to retirement.
Withdrawal phase, two estimates:
- 4% rule: 4% of the final nest egg per year, divided by 12 for the monthly figure. Originally derived for a 30-year horizon from the Trinity Study.
- Annuity-style: the level monthly payment that depletes the nest egg to $0 over your post-retirement years at the same return — the same amortization formula used by mortgage calculators, in reverse.
The 4% rule, in context
The 4% rule says you can withdraw 4% of your portfolio in year one of retirement, then adjust that dollar amount for inflation each year, with a high historical probability of lasting 30 years across the stock-and-bond combinations the Trinity researchers tested. It's a rule of thumb, not a guarantee — newer research suggests 3.3-3.7% is safer for longer retirements or in low-yield environments, while flexible spenders who cut back in bad years can sometimes go higher. Use 4% as a starting figure and tune from there.
What this doesn't include
Three big things. Social Security: for average US earners, Social Security typically replaces 30-40% of pre-retirement income, so add your estimated benefit on top of the withdrawal figure for a complete picture. Inflation: if you use a nominal return (say 10%), the dollar amounts here are nominal too — buying power 30 years out is much lower. Use a real return (around 7%) if you want today's dollars. Taxes: withdrawals from traditional 401(k)/IRA are taxed as ordinary income; Roth withdrawals aren't. The monthly figure here is gross.
How to use the result
Three practical comparisons:
- Save more. Bump the monthly contribution by $100 and see the nest egg jump tens or hundreds of thousands at long horizons.
- Work longer. Each additional year of work is one less year of withdrawals and one more year of compounding — a powerful double effect.
- Sanity-check FIRE math. If you want to retire at 50, the calculator quickly shows whether your contributions and return assumptions are realistic — or whether something has to give.
Use with the other money tools
For a pure investment projection without the withdrawal phase, the investment calculator is leaner. For tax planning on those withdrawals, the income tax calculator models federal tax. To translate salary into the savings side, the salary calculator handles the gross-to-monthly conversion.