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Find your number: what to save monthly to retire well.
Retirement feels far away until you run the numbers. Enter your monthly savings, expected return, current age and target retirement age to project your nest egg. The math rewards starting now — even modest monthly amounts compound into serious money over 30+ years.
Retirement savings is the purest real-world application of compound interest: regular contributions, invested for decades, growing on themselves. The math rewards starting early far more than it rewards contributing more later — money invested at 30 has 35 years to compound before 65, while money invested at 40 has only 25, and the gap between those two outcomes is staggering, as the examples below show. Time is the one input you cannot buy back, which makes procrastination the costliest mistake in retirement planning, worse than picking a mediocre fund.
The standard vehicles in the US are the 401(k) — often with an employer match, which is free money you should never leave on the table — and the IRA (traditional or Roth). Contribution limits and tax treatment change yearly, so verify current figures with the IRS rather than relying on memory. The biggest risks are not market crashes but behavior: withdrawing early (usually with taxes plus a 10% penalty), pausing contributions during downturns (which means buying fewer cheap shares — the exact opposite of what works), and underestimating inflation's 2-3% annual erosion of purchasing power, which halves money's value roughly every 24-35 years. A common rule of thumb, the 4% rule, suggests you can withdraw about 4% of your savings annually in retirement with reasonable safety — so $1 million supports roughly $40,000 a year before other income.
Your monthly contributions are projected with the same compounding math as a monthly investment plan over (retirement age − current age) × 12 months.
Monthly rate i = 0.07/12 = 0.0058333, n = 420 months. FV = 500 x (((1+i)^420 - 1) / i) = $900,527. Contributions total 500 x 420 = $210,000; growth supplies the other $690,527 — more than three times what was put in. The growth-to-contribution ratio (3.29x) shows compounding doing the heavy lifting: the first $210,000 of value took decades to accumulate, while the last $210,000 arrived in just the final few years.
Same $500 a month at 7%, but n = 300 months: FV = 500 x (((1+i)^300 - 1) / i) = $405,036. Contributions are $150,000 — about 71% of the early starter's $210,000 — yet the final balance is only 45% as large ($405,036 vs $900,527). Ten lost years of compounding cost roughly $495,491: the most expensive procrastination in personal finance. To catch up, the late starter would need to contribute about $1,112 a month — more than double — for the remaining 25 years. Starting late is recoverable, but the price is steep.
A popular guideline is 15% of income starting in your 20s or 30s. The honest answer depends on when you start, your lifestyle target and expected returns — run a few scenarios here to find your number.
Many planners use 6–8% nominal annual return for a stock-heavy portfolio, or 4–5% after inflation. Being conservative in your assumption is safer than being optimistic.
No, but the math gets steeper: someone starting at 45 must save roughly 3–4× more per month than someone starting at 25 to reach the same nest egg. A higher savings rate and a later retirement age both help close the gap.