How much do I need to retire?
A common rule of thumb is the 25x rule: multiply your desired annual retirement income by 25. For $60,000/year, you need roughly $1.5M saved. This is based on the 4% safe withdrawal rate — the percentage you can draw annually without a high probability of running out of money over a 30-year retirement. Use the calculator above to find your specific number.
What annual return should I use?
The S&P 500 has returned roughly 10% annually before inflation and about 7% after inflation over the long term. Most planners recommend 6–7% for a diversified portfolio in projections. The default here is 7%. For bond-heavy or conservative portfolios, use 3–4%.
What is compound interest?
Compound interest is interest earned on both your principal and previously earned interest. Unlike simple interest, it grows exponentially. The more frequently it compounds — daily vs. annually — the faster growth occurs. Even small differences in return rate compound dramatically over 20–30 years, which is why starting early matters so much.
What is the 4% retirement rule?
Developed from the 1994 Trinity Study, the 4% rule suggests retirees can withdraw 4% of their portfolio in year one (then adjust for inflation) with a high probability of the portfolio lasting 30+ years. It's a starting point, not a guarantee — actual safe withdrawal rates depend on your asset allocation, retirement length, and market conditions. Some planners now recommend 3–3.5% to be more conservative.