Finance
Retirement Savings Calculator
Project your retirement nest egg and estimate how long your savings will last during your retirement years.
Inputs
Results
Nest Egg at Retirement (Inflation Adjusted)
$0.00
Nominal Nest Egg Value
$0.00
Adjusted Monthly Retirement Income
$0.00
Estimated Nest Egg Lifespan
0 years
How It Works
The retirement calculator models investment growth until your target retirement age, then simulates the depletion of that capital based on desired withdrawals. To ensure calculations represent real purchasing power, future balances are discounted using the inflation rate. Drawdown periods assume a conservative 5% nominal return (inflation-adjusted to a real return) on the remaining portfolio balance during retirement.
Formula Used
Real Interest Rate = (1 + Nominal Rate) / (1 + Inflation Rate) − 1
To reflect the future purchasing power of your retirement savings, the nominal interest rate is deflated by the inflation rate. This adjusts the compounding return to represent constant dollars rather than inflated nominal figures.
Worked Example
Here is a step-by-step example of how these values are calculated:
Current Age
30
Retirement Age
65
Current Savings
$50,000
Monthly Contribution
$500
Annual Return
8%
Inflation
2.5%
Desired Income
$5,000/mo
Result: Nest Egg (Inflation Adjusted): $522,504.60. Nominal Nest Egg: $1,240,049.33. Desired Income at Ret.: $11,866.29/mo. Savings will last: 9 Years, 1 Month.
Frequently Asked Questions
What is the 4% rule?
The 4% rule is a guideline stating that you can safely withdraw 4% of your retirement nest egg in the first year of retirement, and adjust that amount for inflation in subsequent years, with a high probability of not running out of money for 30 years.
Why does inflation matter so much for retirement planning?
Inflation reduces your purchasing power over time. A monthly expense of $5,000 today will cost nearly $12,000 in 35 years at a modest 2.5% inflation rate. Projections must account for inflation to prevent under-saving.