Retirement Calculator
Project your retirement savings. See how your current savings and monthly contributions grow by retirement age.
$25,000 saved plus $500 a month at a 7% return grows to about $812,898 over 30 years — of which $607,898 is investment growth and only $205,000 is money you contributed.
Calculator
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How This Calculator Works
The retirement calculator projects the future value of your savings using compound growth:
FV = Current × (1+r)^n + PMT × [(1+r)^n - 1] / r
Where r is the monthly return rate and n is the total months until retirement.
Worked example
Using the defaults — $25,000 saved today, $500 a month, a 7% annual return, over 30 years:
With monthly compounding, r = 7% ÷ 12 = 0.005833 and n = 360 months.
Grow the existing savings. $25,000 × (1.005833)^360 = $190,306. Your starting balance nearly octuples on its own, without a single additional contribution.
Grow the contributions. The contribution stream is worth $812,898 − $190,306 = $622,592 at the end. You paid in $500 × 360 = $180,000, so the contributions earned $442,592 by themselves.
Separate the sources. Total contributed is $25,000 + $180,000 = $205,000. Investment growth is $812,898 − $205,000 = $607,898. Three quarters of the final balance is growth, not saving.
Convert it to retirement income. At a 4% withdrawal rate, $812,898 supports about $32,500 a year, or $2,700 a month, before tax. That is the number to compare against what you actually expect to spend.
Enter 25000, 500, 7 and 30 above to reproduce the total. A 7% nominal return is an assumption, not a promise; sequence-of-returns risk means the path matters as much as the average.
The same plan over different horizons
The contribution stream dominates early; compounding dominates late. Each row uses the same $25,000 start and $500 monthly contribution at 7%.
| Horizon | Final balance | Total contributed | Growth | Growth as % of balance |
|---|---|---|---|---|
| 10 years | $136,784 | $85,000 | $51,784 | 38% |
| 20 years | $361,432 | $145,000 | $216,432 | 60% |
| 30 years (default) | $812,898 | $205,000 | $607,898 | 75% |
| 40 years | $1,720,192 | $265,000 | $1,455,192 | 85% |
The 40-year figure assumes contributions continue to age 65 from a start at 25. Doubling the time from 20 to 40 years multiplies the final balance by 4.76, which is the clearest expression of what compounding does with a long horizon.
Common mistakes with this calculation
- Using a nominal return and comparing it to today's spending. A 7% nominal return against 3% inflation is about 3.9% real. Discount a $812,898 projection by 30 years of inflation and it buys roughly what $335,000 buys today. Model in real terms, or model inflation explicitly — but do not compare a nominal balance to current prices.
- Starting too late and assuming a higher return can compensate. Saving $500 from age 35 for 30 years produces $812,898. Starting at 25 for 40 years at the same contribution produces $1,720,192 — 2.1 times as much. Closing a ten-year gap requires roughly doubling the monthly contribution, which is usually not affordable.
- Forgetting the employer match and fees. A 50% match on the first 6% of salary is an immediate 50% return, larger than any market return you will get. A 1% fund fee, by contrast, removes roughly 25% of a 30-year balance. Both dwarf the difference between a 6% and 7% return assumption.
- Ignoring required minimum distributions and taxes. Traditional 401(k) and IRA balances are taxed as ordinary income on withdrawal, and RMDs begin at age 73 in the US. A $812,898 balance could face a substantial tax bill on withdrawal. Model after-tax income, not the gross balance.
When this calculator does not apply
- It assumes a constant annual return, which no portfolio delivers. Real returns arrive in a volatile sequence, and the order matters enormously.
- It ignores inflation entirely, so the projected balance is nominal.
- It cannot model a changing contribution schedule — raises, career breaks, a period of unemployment, or catch-up contributions after age 50.
- It ignores Social Security, pensions and other income, all of which change what the portfolio needs to deliver.
- It excludes taxes, fund fees, and advisory fees, all of which reduce the spendable outcome.
Frequently Asked Questions
How much do I need to retire?
A common rule is 25 times your annual expenses (the "4% rule"). For example, if you need $40,000/year in retirement, aim for $1,000,000 saved.
Is 7% return realistic?
A 7% real (inflation-adjusted) return is reasonable for a diversified stock portfolio. Conservative estimates use 5-6%.
Sources & Methodology
This calculator uses standard financial formulas. See our methodology page for the full formula derivation.
- Retirement Planning Tools Consumer Financial Protection Bureau
- Retirement Topics — Contributions Internal Revenue Service
- Required Minimum Distributions Internal Revenue Service
- Survey of Consumer Finances Federal Reserve
- National Compensation Survey — Retirement Benefits US Bureau of Labor Statistics
Last reviewed .
Key takeaways
- $25,000 plus $500 a month at 7% reaches about $812,898 in 30 years.
- Of that, $607,898 is growth and $205,000 is contributions — 75% of the total comes from compounding.
- At a 4% withdrawal rate the balance supports roughly $32,500 a year before tax.
- A nominal 7% is about 3.9% after 3% inflation, so model in real terms.
- Time is the input with the largest effect and the one you cannot buy back later.