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Retirement Plan Calculator

This Retirement Plan Calculator helps you estimate the amount you will accumulate before retirement and how much you need to fund your retirement period.

Retirement Savings and Withdrawal Estimator

Input Fields
years
years
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$
%
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Retirement Accumulation and Funding Formulas

Formula
\[ \text{FV}_{\text{accum}} = \sum_{t=1}^{T} \left[ \text{Income}_t \times \frac{p}{100} \times (1 + r)^{T – t} \right] \] \[ \text{PV}_{\text{retire}} = \text{Annual Need} \times \frac{1 – (1 + r)^{-N}}{r} \]

Where:

  • \( \text{FV}_{\text{accum}} \) = Future value of retirement savings at retirement age
  • \( \text{Income}_t \) = Annual income at year \( t \)
  • \( p \) = Percentage of income saved each year
  • \( r \) = Annual rate of return
  • \( T \) = Number of years until retirement
  • \( \text{PV}_{\text{retire}} \) = Present value of amount needed at retirement
  • \( \text{Annual Need} \) = Desired annual income during retirement
  • \( N \) = Number of years in retirement


Retirement Planning – Calculation Example

Suppose:

  • You save 10% of $60,000 income annually for 30 years at 6% return.
  • You need $40,000 per year in retirement for 20 years at the same rate.

Calculation:

  1. $$\text{FV}_{\text{accum}} = \sum_{t=1}^{30} \left[ 60,000 \times 0.10 \times (1.06)^{30 – t} \right] \approx 502,257$$
  2. $$\text{PV}_{\text{retire}} = 40,000 \times \frac{1 – (1.06)^{-20}}{0.06} \approx 459,230$$

So, your projected savings should be enough to fund retirement.

This calculator estimates both the future value of your retirement savings and the present value of income needed during retirement. It’s designed for long-term planning and evaluates how much you must save during your working years to maintain your desired lifestyle after retirement. It accounts for investment growth and longevity of retirement withdrawals.

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