Retirement Savings Projection
Your Projection Results
*Inflation-adjusted value represents the purchasing power of your savings in today's dollars.
Understanding Your Retirement Projection
Planning for retirement is one of the most critical financial tasks you will face. This calculator helps you visualize how compounding interest, regular contributions, and time work together to build your future wealth. By inputting your current age and target retirement age, we can determine the "accumulation phase" duration.
The Power of Compounding
The "Expected Annual Return" is the growth rate of your investments. In the early years of saving, your monthly contributions make up most of your portfolio growth. However, as your balance increases, the interest earned on your interest (compounding) begins to do the heavy lifting. This is why starting early is often more important than the amount you contribute.
A 30-year-old with $10,000 saved, contributing $500 monthly with a 7% return, will have approximately $1,050,000 by age 65. If that same person waits until age 40 to start, they would have only about $480,000, even with the same monthly contribution.
Why Inflation Matters
A million dollars today will not buy the same amount of goods 30 years from now. Our calculator provides an "Inflation-Adjusted Value." This metric discounts your future nest egg by the inflation rate you provide (typically 2-3%), showing you what that future sum would feel like in "today's money." This helps you set more realistic goals for your lifestyle needs.
Variable Factors
- Expected Return: Generally, a diversified stock portfolio historically returns 7-10% before inflation, while more conservative bond-heavy portfolios return 3-5%.
- Inflation: The long-term US average is roughly 3%, though this varies by decade.
- Monthly Contributions: Consistency is key. Increasing this number by even $50 a month can result in tens of thousands of extra dollars over a 30-year career.