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Retirement Calculator

The future value of retirement savings depends on time, contributions, and compound growth. A 30-year-old with $20,000 in savings contributing $500 per month at a 7% average annual return would accumulate an estimated $1,028,000 by age 65, or approximately $503,000 in today's dollars after adjusting for 3% inflation. Enter your details below to see an estimated projection of your retirement savings and its inflation-adjusted purchasing power.

Quick Answer

A 30-year-old with $20,000 saved, contributing $500/month at 7% annual return, would accumulate an estimated $1,028,000 by age 65, or approximately $503,000 in inflation-adjusted (3%) dollars.

Common Examples

Input Result
Age 25, retire at 65, $10,000 saved, $300/month, 7% return, 3% inflation Estimated $935,000 (approximately $354,000 inflation-adjusted)
Age 30, retire at 65, $20,000 saved, $500/month, 7% return, 3% inflation Estimated $1,028,000 (approximately $503,000 inflation-adjusted)
Age 35, retire at 65, $50,000 saved, $750/month, 7% return, 3% inflation Estimated $1,136,000 (approximately $681,000 inflation-adjusted)
Age 40, retire at 67, $100,000 saved, $1,000/month, 6% return, 3% inflation Estimated $1,003,000 (approximately $481,000 inflation-adjusted)
Age 45, retire at 65, $200,000 saved, $1,500/month, 7% return, 2.5% inflation Estimated $1,325,000 (approximately $817,000 inflation-adjusted)

How It Works

This calculator uses monthly compounding to project retirement savings. Each month, the current balance earns a return and a new contribution is added.

Monthly Compounding Formula:

For each month: Balance = Previous Balance x (1 + r/12) + Monthly Contribution

Where r is the annual return rate expressed as a decimal (e.g., 7% = 0.07).

This is repeated for every month from the current age to the retirement age, building up the balance through both investment growth and regular contributions.

Total Contributions:

Total Contributions = Current Savings + (Monthly Contribution x Months to Retirement)

Investment Gains:

Investment Gains = Total Savings - Total Contributions

Inflation Adjustment:

To show the estimated purchasing power in today’s dollars:

Inflation-Adjusted Value = Total Savings / (1 + inflation rate)^years

This accounts for the gradual erosion of purchasing power over time. A dollar today buys more than a dollar 30 years from now due to inflation.

Worked Example

For a 30-year-old with $20,000 in current savings, contributing $500/month, at 7% annual return, retiring at 65: Years to retirement = 35. Monthly return = 0.07/12 = 0.005833. Total months = 420. Starting with $20,000, the balance compounds monthly for 420 months with $500 added each month. After 35 years: estimated total savings = approximately $1,028,000. Total contributions = $20,000 + ($500 x 420) = $230,000. Estimated investment gains = approximately $798,000. At 3% inflation: inflation-adjusted value = $1,028,000 / (1.03)^35 = approximately $503,000 in today’s purchasing power.

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Frequently Asked Questions

What annual return rate should I use?
The long-term average annual return of the S&P 500 has been approximately 10% before inflation, or roughly 7% after inflation. A common approach is to use 7% as a conservative estimate for a stock-heavy portfolio. More conservative portfolios with bonds may return 4% to 6%. The rate you choose significantly affects the projection.
Does this account for taxes on withdrawals?
No. This calculator projects the pre-tax balance at retirement. If savings are in a traditional 401(k) or IRA, withdrawals will be taxed as ordinary income. Roth accounts allow tax-free withdrawals in retirement. The actual spendable amount depends on your account type and tax situation at the time of withdrawal.
What inflation rate should I use?
The Federal Reserve targets a 2% annual inflation rate. Historical U.S. inflation has averaged approximately 3% over the long term. Using 2.5% to 3% provides a reasonable estimate, though actual inflation varies year to year.
How accurate is this projection?
This projection assumes a constant annual return compounded monthly, with no market fluctuations, fees, or changes in contribution amount. Real-world returns vary significantly from year to year. This illustrates the potential power of consistent saving and compound growth, but actual results will differ. It is not financial advice.
Can I include employer matching contributions?
Yes. Add your employer's matching contribution to the monthly contribution amount. For example, if you contribute $500/month and your employer matches 50%, enter $750 as the total monthly contribution.