A guideline from William Bengen's 1994 study of US market history: withdraw 4% of your savings in the first year of retirement, raise the amount with inflation each year, and the money lasted at least 30 years in almost every historical period. The Trinity study in 1998 reached a similar result.

How much should I save each month for retirement?

Enough to fill the gap between the corpus you need and what your current savings will grow to. In the example, a 30-year-old with 50,000 saved needs about 930 a month at 7%. Starting ten years later roughly doubles the monthly figure.

Why does inflation matter so much?

Because it compounds for decades before retirement and then keeps raising your spending during it. At 3%, prices roughly double in 24 years, so 4,000 a month today is about 11,255 a month in 35 years.

Does this include Social Security or a pension?

No. Subtract their expected monthly amount from your spending before entering it, so the page works out only what your savings must cover.

Retirement Calculator (How Much Do I Need to Retire?)

How much you need saved at retirement for inflation-rising spending over your retirement years, and the monthly saving that gets you there.

Inputs

CurrencyAuto (USD)

Current age

1870

Retirement age

4075

Current monthly expense

$52$10,300

Inflation(%)

0 %15 %

Expected return(%)

0 %20 %

Current savings

$0$1,030,900

Years in retirement(years)

1 years60 years

Include CalculateEveryday mark

Corpus needed at retirement

$2,219,188

Corpus needed

From current savings$533,829 (24%)
From new saving$1,685,359 (76%)

Monthly saving needed: $930
Monthly expense at retirement: $11,255
Inflation factor: 1.03^35 = 2.814
Current savings grow to: $533,829
4% rule check (25 × first year's spending): $3,376,635
Real return (after inflation): 3.88% a year
Years to retirement: 35

Assumes 25 years in retirement, spending rising 3% a year, and 7% a year on savings before and after.
Illustrative only — actual needs depend on lifestyle, healthcare, pensions or Social Security, taxes and market returns.

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What each Retirement input means

Current age: Your age today.
Retirement age: When you plan to stop working and start drawing on savings.
Current monthly expense: What you spend a month now, in today's money, on the lifestyle you want to keep. Leave out costs that end at retirement, such as a mortgage paid off by then or commuting.
Inflation: Expected yearly price rise. US consumer prices averaged about 2.5% a year from 2000 to 2025; India's targets 4%.
Expected return: Average yearly return on savings, before and during retirement. A mix of shares and bonds might be assumed at 5–7%; be cautious.
Current savings: Retirement savings you already have.
Years in retirement: How long the money must last. 25–30 years is common; plan longer if you retire early or your family lives long.

Retirement formula

Spending at retirement = today's spending × (1 + inflation)^years to go · Corpus = Σ yearly spending (rising with inflation) ÷ (1 + return)^year, over the retirement years · Monthly saving = shortfall × i ÷ (((1 + i)^n − 1) × (1 + i))

The question is how big a pot of savings — a corpus, or nest egg — you need on the day you retire to pay for the life you lead now, for as long as retirement lasts. The page works it in three steps. First, today's monthly spending is inflated to the retirement date, because prices will be higher then. Second, it adds up every year of retirement spending, each year rising with inflation, discounted back to the first day of retirement at the return you expect the savings to keep earning; that total is the corpus. Third, it grows what you have saved already to the retirement date, and the rest of the corpus is the shortfall: the monthly saving that fills it is OpenStax's 'payment required to reach a goal', with deposits at the start of each month. For comparison it shows the 4% rule, from William Bengen's 1994 study and the 1998 Trinity study: spending 4% of the starting balance in the first year, then rising with inflation, lasted at least 30 years in almost all historical US periods, which means a target of 25 times the first year's spending.

Retirement worked example

A 30-year-old spending $4,000 a month today, retiring at 65: 3% inflation over 35 years multiplies prices by 2.814, so that lifestyle costs about $11,255 a month at retirement. Paying for 25 years of it, rising 3% a year, from savings earning 7% needs about $2,219,188. The $50,000 saved today grows to $533,829 by 65, and saving about $930 a month covers the rest. The 4% rule would ask for more, $3,376,635, because it is built to last 30 years in bad markets.

More Retirement examples

Plan for a 30-year retirement at a more cautious 6% and the corpus needed is $2,376,901; the $50,000 already saved grows to $287,175, and the monthly saving needed is about $2,070.

Where the Retirement calculator can give the wrong answer

Pensions, Social Security, annuities and rental income reduce what savings must cover. Subtract their monthly amount from your spending before entering it.
The return is assumed steady before and after retirement. A market fall in the first years of retirement does more damage than the same fall later — sequence-of-returns risk — which the 4% rule's historical test captures and this smooth projection does not.
Taxes are not included. Withdrawals from pre-tax accounts such as a 401(k) or traditional IRA are taxed as income, so the spending figure should include the tax on it.
Healthcare costs often rise faster than general inflation in retirement; a higher inflation rate is a simple way to allow for that.
If your savings already cover the corpus, the monthly saving needed is zero; the page does not show a negative figure.

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Retirement reference table

Starting withdrawal rate and the savings it implies
First-year withdrawal	Savings needed (× annual spending)	What history suggests
3%	33×	A common choice for retirements of 40 years or more
4%	25×	Lasted at least 30 years in almost all US periods since 1926 (Bengen 1994)
5%	20×	Ran out within 30 years in a meaningful share of historical periods

Source: Bengen, Journal of Financial Planning 1994; Cooley, Hubbard & Walz, AAII Journal 1998

Retirement FAQ

: Roughly 25 times your yearly spending in retirement by the 4% rule — 1 million for 40,000 a year — less what pensions or Social Security will pay. This page refines that with your own inflation, return and retirement length.
: A guideline from William Bengen's 1994 study of US market history: withdraw 4% of your savings in the first year of retirement, raise the amount with inflation each year, and the money lasted at least 30 years in almost every historical period. The Trinity study in 1998 reached a similar result.
: Enough to fill the gap between the corpus you need and what your current savings will grow to. In the example, a 30-year-old with 50,000 saved needs about 930 a month at 7%. Starting ten years later roughly doubles the monthly figure.
: Because it compounds for decades before retirement and then keeps raising your spending during it. At 3%, prices roughly double in 24 years, so 4,000 a month today is about 11,255 a month in 35 years.
: No. Subtract their expected monthly amount from your spending before entering it, so the page works out only what your savings must cover.