Retirement Calculators
Our retirement calculators help you plan for your financial future, estimate how much you'll need to save, and develop strategies to achieve your retirement goals.
Planning for Retirement
Retirement planning is one of the most important aspects of personal finance. Starting early and having a clear strategy can make the difference between financial struggle and security in your later years.
The Power of Compound Interest
When saving for retirement, time is your greatest asset. Thanks to compound interest, even small contributions can grow significantly over decades. For example, $5,000 invested at age 25 could be worth over $75,000 by age 65 (assuming a 7% annual return). The same $5,000 invested at age 45 would only grow to about $20,000 by age 65.
Retirement Savings Vehicles
There are several tax-advantaged ways to save for retirement:
- 401(k)/403(b): Employer-sponsored plans that often include matching contributions
- Traditional IRA: Contributions may be tax-deductible now, with taxes paid upon withdrawal
- Roth IRA: Contributions are made with after-tax dollars, but qualified withdrawals are tax-free
- SEP IRA/Solo 401(k): Options for self-employed individuals
- Health Savings Account (HSA): Can be used as a retirement account with proper planning
The 4% Rule and Withdrawal Strategies
The traditional 4% rule suggests that you can withdraw 4% of your retirement savings in the first year of retirement, then adjust that amount for inflation each year. This rule aims to balance having enough money for your lifetime while enjoying retirement. However, individual circumstances vary, and the rule may not be appropriate for everyone.
Social Security Considerations
While Social Security provides a foundation for retirement income, it's typically not enough to maintain your pre-retirement standard of living. The age at which you claim benefits affects the amount you receive. Claiming at the earliest age (62) results in reduced benefits, while delaying until age 70 increases your monthly benefit.