Retirement Nest Egg Target Calculator
Find the nest egg you need to retire: grows today's spending by inflation and divides by a safe withdrawal rate (4% rule). Runs in your browser.
Retirement nest egg target
- Spending need at retirement
- $125,627/yr
- Nest egg target (4% rule)
- $3,140,667
- In today's dollars
- $1,500,000
- Multiple of annual spending
- 25×
Future spending = today's spending grown by inflation; nest egg = future spending ÷ withdrawal rate (the 4% rule implies 25× spending, from the Trinity study / Bengen 1994). It assumes a 30-year retirement and a stock/bond mix; lower rates (3–3.5%) are safer for longer or earlier retirements. Excludes Social Security/pensions — subtract those from spending. Informational, not financial advice.
About this tool
How big does your retirement nest egg need to be? This calculator answers it in two steps. First it grows your current annual spending by expected inflation over the years until you retire, because $60,000 of lifestyle today will cost more in future dollars. Then it divides that future spending by a safe withdrawal rate to get the portfolio that can sustain it. The default 4% withdrawal rate comes from the well-known 'Trinity study' and William Bengen's 1994 research, which found that withdrawing about 4% of a stock/bond portfolio in the first year and adjusting for inflation thereafter historically lasted at least 30 years — equivalently, you need roughly 25 times your annual spending. The tool also shows the target in today's dollars and lets you choose a more conservative rate (3–3.5%), which is wise for earlier or longer retirements. Remember to subtract guaranteed income like Social Security or a pension from the spending you need your portfolio to cover. It is informational, not financial advice. Everything runs in your browser.
How to use it
- Enter your annual spending in today's dollars (minus any pension/Social Security).
- Enter years until retirement and expected inflation.
- Choose a safe withdrawal rate (4% is the classic; 3–3.5% is more conservative).
- Read the nest egg target, both in future and today's dollars.
Frequently asked questions
- What is the 4% rule?
- A retirement guideline from the Trinity study and Bengen (1994): withdraw 4% of your portfolio the first year and adjust that dollar amount for inflation each year after. Historically that lasted 30+ years for a balanced portfolio. It implies a nest egg of about 25× your annual spending.
- Why divide spending by the withdrawal rate?
- Because the withdrawal rate is the fraction of the portfolio you take each year. If 4% must cover your spending, the portfolio is spending ÷ 0.04 = 25 × spending. A 3% rate needs 33×; a 5% rate, 20×.
- Is 4% still safe?
- It is a strong historical baseline for ~30-year retirements, but some researchers suggest 3–3.5% for early retirees, longer horizons, or lower expected returns. The tool lets you pick a more conservative rate to build in a margin of safety.
- Why grow spending by inflation?
- Because you retire in the future, when prices are higher. The nest egg must support your real lifestyle then, so today's spending is inflated to the retirement date before applying the withdrawal rate. The tool also shows the figure in today's dollars for intuition.
- Should I include Social Security or a pension?
- Subtract them from the spending your portfolio must cover. If you spend $60k/year and expect $20k from Social Security, base the target on the $40k gap — that substantially lowers the nest egg you need.
- Is this financial advice?
- No. It is an informational target based on a historical rule of thumb. For a personalized retirement plan, consult a financial advisor.