Retirement Savings Examples (2026)
How Savings Strategies Impact Your Nest Egg
The table below illustrates different scenarios assuming a 7% annual return (historical S&P 500 average) and 2.5% inflation. The "Monthly Income" column shows what you could safely withdraw using the 4% rule.
| Current Age | Retirement Age | Current Savings | Monthly Contribution | Total at Retirement | Inflation Adjusted | Monthly Income (4% Rule) |
|---|---|---|---|---|---|---|
| 25 | 65 | $5,000 | $500 | $1,247,000 | $600,000 | $2,000 |
| 30 | 65 | $10,000 | $500 | $1,012,000 | $530,000 | $1,767 |
| 35 | 65 | $25,000 | $750 | $1,156,000 | $650,000 | $2,167 |
| 40 | 65 | $50,000 | $1,000 | $1,089,000 | $680,000 | $2,267 |
| 25 | 60 | $5,000 | $750 | $1,456,000 | $750,000 | $2,500 |
| 30 | 60 | $20,000 | $1,000 | $1,234,000 | $720,000 | $2,400 |
ℹ️Calculations assume 7% annual return, 2.5% inflation, and monthly compounding. The 4% rule suggests withdrawing 4% of your portfolio annually for a 30-year retirement. Actual results may vary based on market conditions.
How We Calculate Your Retirement
Our retirement calculator uses the compound interest formula adjusted for inflation to give you a realistic view of your future purchasing power.
Investment Growth
We calculate capital appreciation based on your estimated annual return, compounded monthly, reflecting how money makes money over time.
Inflation Adjustment
We discount your future total back to today's dollars using your provided inflation rate, showing what your savings will actually buy.
Monthly Income
We apply the 4% Safe Withdrawal Rule to estimate a sustainable monthly income that aims to last for a 30-year retirement.
Data Sources & Methodology (2026 Update)
The default values in this calculator are based on historical market data and economic projections for 2026:
Use Professional Judgment
This tool provides estimates for informational purposes only and does not constitute financial advice. Tax laws and economic conditions may change. Consult a qualified financial advisor for personalized planning.
Last updated: Jan 2026
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Planning for retirement involves multiple financial considerations. These related tools can help you build a complete financial picture:
Key Retirement Terms Explained
Compound Interest
Often called the "eighth wonder of the world," this is interest calculated on the initial principal and also on the accumulated interest of previous periods. It causes your savings to grow exponentially over time.
Safe Withdrawal Rate (4% Rule)
A guideline stating you can withdraw 4% of your portfolio in the first year of retirement, and adjust that amount for inflation thereafter, with a high probability of not running out of money for 30 years.
Real Rate of Return
The annual percentage return realized on an investment, adjusted for changes in prices due to inflation. If your investments grow 7% but inflation is 3%, your real return is roughly 4%.
Time Horizon
The total length of time you expect to hold an investment or need your savings to last. A longer time horizon generally allows for more aggressive investing.
Sequence of Returns Risk
The risk that you experience negative market returns early in retirement when you are withdrawing money. This can significantly deplete your portfolio compared to experiencing those same negative returns later in retirement.
Frequently Asked Questions
When can I retire?
You can retire once your passive income (from savings, pension, Social Security) exceeds your annual expenses. For many, this happens between ages 60 and 67, but "FIRE" (Financial Independence, Retire Early) practitioners aim for as early as 30s or 40s. Use our ROI Calculator to see how different investment returns affect your retirement timeline.
How does inflation affect my savings?
Inflation reduces the purchasing power of money over time. $1 million today will buy significantly less in 30 years. Our calculator adjusts for this, showing you the "Real Value" of your money so you don't overestimate your wealth. For detailed inflation analysis, use our Inflation Calculator.
How much money do I need to retire at 65?
Retirement needs vary by lifestyle, but a common benchmark is to replace 70-80% of your pre-retirement income. If you earn $100,000, aim for $70,000-$80,000 annually. Using the 4% rule, a $80,000 income could require a portfolio of roughly $2 million.
Does this calculator include Social Security?
This calculator focuses on your personal savings growth and nest egg. You should subtract your estimated Social Security benefits from your required annual income to find your "savings gap". Most advisors recommend viewing Social Security as a supplement to, not a replacement for, your own savings.
What is the "FIRE" movement?
FIRE stands for Financial Independence, Retire Early. It's a lifestyle and financial strategy of aggressive saving (often 50-70% of income) and frugal living to build a nest egg quickly, potentially allowing retirement in your 30s or 40s. FIRE principles emphasize low-cost index funds and withdrawal rates often lower than the standard 4%.
How do taxes affect my retirement withdrawals?
Taxes can take a big bite out of your retirement income. Withdrawals from traditional 401(k)s and IRAs are taxed as ordinary income. Roth IRA withdrawals are typically tax-free. Taxable brokerage accounts are subject to capital gains tax. This calculator shows gross accumulation; it's wise to aim for 15-20% more than you think you need to cover potential tax liabilities.
Should I pay off my mortgage before retiring?
Entering retirement mortgage-free significantly reduces your monthly fixed expenses, meaning you need a smaller nest egg to survive. However, if your mortgage interest rate is very low (e.g., under 3%), investing that extra money might yield higher returns than the interest you save. It's often a trade-off between mathematical optimization and the psychological peace of mind of being debt-free.
How much should I have saved by age 30, 40, 50?
Fidelity suggests saving 1x your salary by age 30, 3x by 40, 6x by 50, and 10x by 67. These are general benchmarks; your personal "number" heavily depends on when you want to retire and your expected spending habits in retirement.