TheFreeTool

Retirement Calculator

Enter your age, the age you want to retire, what you have saved and what you add each month. You will see your pot at retirement, what it is worth in today's money and a rough monthly income.

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Good to know

This is an estimate for general information. It is not tax, legal or financial advice. Your payslip can differ because of tax codes, credits, local taxes, benefits and your employer's rules. Check official guidance or ask a qualified adviser.

What it does

  • Savings at retirement from today's balance and monthly saving
  • The same amount in today's money after inflation
  • A rough monthly income using the 4% rule
  • Any currency from the currency menu

How to use it

  1. Enter your age and your planned retirement age.
  2. Enter your current savings and what you add each month.
  3. Enter the return you expect and inflation, then read the results.

How does the retirement calculator work?

It grows your current savings and your monthly contributions at the yearly return you choose, month by month, until retirement. Because prices rise, it also shows that total divided by inflation, so you can see what it would feel like in today's money.

The monthly income uses the 4% rule of thumb: you could withdraw about 4% of the pot in the first year and adjust for inflation after that. It is a guide, not a promise. Markets go up and down, returns are never guaranteed, and tax and pensions from the state or an employer are not included.

Example

At 35 with $50,000 saved, adding $800 a month at a 6% return until 65, you could have about $1,067,000. With 2.5% inflation that is worth about $509,000 in today's money, which supports roughly $1,700 a month at 4% a year. You would have put in $338,000 yourself.

Questions people ask

What return should I use?
Many planners use 4% to 7% a year before inflation for a mix of shares and bonds. Use a lower number to be careful.
What is the 4% rule?
A rule of thumb that you can take about 4% of your pot in the first year of retirement, then adjust for inflation, and have it last around 30 years.
Does it include pensions or tax?
No. State pensions, employer pensions and tax would change your real income. Check those separately.

Disclaimer

This tool is for general information only. It is not financial, tax, investment or legal advice, and results are estimates that may differ from your bank, lender or tax authority. Rates, limits and tax rules change. Bank and brand names are used only to describe what the tool does; they belong to their owners and we are not affiliated with them. Check the figures with a qualified professional or your provider before you decide. You use this tool at your own risk, and TheFreeTool is not liable for any loss that follows. Read the full disclaimer

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