This retirement calculator uses a deterministic model to project portfolio values over time based on user inputs. The model assumes constant returns and inflation rates, providing a simplified view of retirement planning.
From your current age until retirement age, the calculator assumes your portfolio grows annually based on the expected return rate. No withdrawals are made during this phase.
From retirement age until life expectancy (or portfolio depletion), the calculator applies investment returns annually and subtracts your annual spending. Spending is adjusted each year for inflation.
Balance(t) = Balance(t-1) × (1 + returnRate) - Spending(t)
Spending(t) = Spending(t-1) × (1 + inflationRate)
The model assumes a constant annual return rate. In reality, investment returns vary significantly year to year. This does not account for market volatility, bear markets, or sequence of returns risk.
Inflation is assumed to be constant at the specified rate. Actual inflation varies over time and can significantly impact purchasing power in retirement.
The model assumes spending increases only with inflation. It does not account for changes in spending patterns, major one-time expenses, healthcare costs, or other factors that typically affect retirement spending.
The model does not include Social Security, pension income, part-time work, or other income sources that many retirees rely on.
The model does not account for taxes on investment returns or withdrawals. Tax treatment varies by jurisdiction and account type.
This calculator is best used as a starting point for retirement planning. It can help you understand the relationship between savings, spending, and retirement timing. However, you should:
This calculator is provided for informational purposes only and does not constitute financial advice. The projections are based on the inputs and assumptions provided and should not be relied upon for making financial decisions. Past performance is not indicative of future results. Consult with a qualified financial advisor before making retirement decisions.