Retirement Savings Calculator
Planning for retirement is one of the most important financial decisions you'll make. The earlier you start saving, the more time compound interest has to grow your money. This calculator helps you determine exactly how much you need to save each month to reach your retirement goal.
Enter your current age, desired retirement age, existing savings, expected annual return, and your target nest egg. The calculator computes the required monthly contribution using the future value of an annuity formula, accounting for compound growth on both your existing savings and future contributions.
How it works
PMT = (FV - PV × (1 + r)^n) × r / ((1 + r)^n - 1), where PMT is the monthly payment, FV is the target amount, PV is current savings, r is the monthly interest rate, and n is the total number of months.
Use cases
- Determining how much to save monthly for a comfortable retirement
- Evaluating whether your current savings rate is on track
- Comparing retirement scenarios with different return rates or target ages
- Understanding the impact of starting to save earlier versus later
Frequently asked questions
How does the retirement savings calculator work?
The calculator uses the future value of an annuity formula: PMT = (FV - PV × (1 + r)^n) × r / ((1 + r)^n - 1). It first projects how much your current savings will grow by retirement at your expected return, then computes the monthly contribution needed to cover the remaining gap between that projection and your target nest egg.
How much should I save per month to retire?
It depends on four inputs: your target amount, how many years remain until retirement, how much you have saved already, and the annual return you expect. Enter those values and the calculator returns the exact monthly contribution. Starting earlier lowers the required amount dramatically because each contribution has more months to compound.
Does the calculator account for savings I already have?
Yes. Your current savings (PV) are grown at the same compound rate for the full period, and only the shortfall between that projected value and your goal must be covered by monthly contributions. The more you already have saved, the lower the required monthly payment.
What annual return should I use for retirement planning?
Use a rate consistent with how your money is actually invested, and lean conservative — an overly optimistic return makes the required monthly saving look smaller than it really is. A practical approach is to run the calculator with a few different rates and compare scenarios, so you can see how sensitive your plan is to market performance.
What happens if I start saving for retirement later?
Delaying reduces n, the total number of months in the formula, which both shrinks the compounding period and spreads the goal over fewer contributions. As a result, the required monthly payment rises sharply the longer you wait. Comparing two starting ages in the calculator is the clearest way to see the cost of postponing.