How to Use a Retirement Calculator

Retirement calculators can help you determine if you’re on track to retire comfortably and whether you need to make changes to your savings or investment strategy. They work by comparing your current savings to your projected retirement income and factoring in other financial aspects of retirement, such as a desired withdrawal rate and taxes.

To use our free Retirement calculator, simply enter your personal information and answer a few short questions. Inputs include your expected retirement age, total annual household income (you and your spouse’s pre-tax salaries), your yearly retirement savings amount, the current total balance of your retirement savings accounts including 401(k) plans, individual retirement accounts (IRAs), stocks and mutual funds and any other designated retirement savings accounts and assets. Go here

The calculator also considers your planned retirement spending and other sources of retirement income, such as Social Security benefits and pension payments. It models the growth of your savings and other assets, such as real estate or a business, over time. It also enables you to compare planning scenarios side-by-side and test your assumptions with a Monte Carlo simulation tool.

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Many experts recommend saving enough to cover your yearly expenses in retirement for the rest of your life. A common rule of thumb is that you’ll need to save 15 to 25 times your annual budget in order to stop working and not run out of money. It’s important to realize that this is a high-level estimate and that it will likely require some adjustments as you get closer to retirement.