How the goal is worked out
The calculator starts with the monthly income you want, then takes away what Social Security and any pension will pay. What is left has to come from savings. Multiply that yearly amount by 25 (at a 4% withdrawal rate) and you have the balance you need on the day you retire. A $4,800 goal with $2,100 from Social Security leaves $2,700 a month, or $32,400 a year, which needs about $810,000 saved. Add a $1,800 pension and the same goal needs only $270,000.
Your current savings and monthly saving are then grown to your retirement age at the return you choose, all in today’s dollars. Progress is your projected balance as a share of what you need.
Why a pension changes everything
Most savings rules of thumb were written for people whose only steady income in retirement is Social Security. A teacher, police officer or state worker with 25 or 30 years in a pension plan may have half or more of their spending covered for life, often with raises for inflation. For them, the right savings target is the gap the pension leaves, not a fixed multiple of salary. Our plan pages show how each pension is calculated.
For the full picture year by year, including a pension that starts at one age and Social Security at another, use My retirement plan. To see how your 401(k) or 403(b) could grow with an employer match, try the 401(k) and 403(b) calculator.
Questions
How much do I need to retire?
A common rule is 25 times the yearly income your savings must provide, which lets you take about 4% a year. The key word is "your savings must provide". Social Security and any pension cover part of your spending, so the amount you need saved is often far less than the usual headline numbers.
What about the "save 10 times your salary" rule?
Benchmarks like 1 times your salary by 30, 3 times by 40, 6 times by 50 and 8 times by 60 assume you will live mostly on savings plus Social Security. If you have a teacher or public pension, you may need much less. That is why this calculator starts from your actual pension and Social Security instead of a fixed multiple.
Why does it use a return above inflation?
Everything here is in today's dollars, so the goal, your savings and the projection can be compared directly with what you earn and spend now. A return of 4% above inflation is roughly what a balanced mix of stocks and bonds has earned over long periods.
What if I am behind?
The result shows how much more a month would close the gap, and how much working one to three more years would help. Working longer helps twice: more years of saving, and fewer years of drawing on savings. A later Social Security claim also lowers how much you need.