Retirement Savings Planner

Estimate how much you could have saved by the time you retire. Enter your current age, desired retirement age, monthly contribution and expected annual return. Consistent saving and the power of compound interest are key to building a comfortable retirement fund.

Why plan for retirement?

Starting early and contributing regularly can dramatically increase your retirement savings due to compound interest. Even small monthly contributions grow over time. Consider investing in diversified portfolios and reviewing your plan annually. This calculator provides a simple projection based on constant contributions and fixed growth, but actual investment returns vary.

Retirement Planning Fundamentals

Retirement planning is one of the most important financial decisions you'll make. Understanding the key concepts and strategies can help you build a secure financial future and achieve your retirement goals.

The Power of Compound Interest

Compound interest is often called "the eighth wonder of the world" because it allows your money to grow exponentially over time. When you earn returns on your investments, those returns generate their own returns, creating a snowball effect.

Key factors that amplify compound growth:

Time: The longer your money is invested, the more time it has to compound
Consistency: Regular contributions, even small ones, add up significantly
Rate of return: Higher returns accelerate growth, but come with increased risk
Starting early: Beginning in your 20s vs. 30s can mean hundreds of thousands more in retirement

Common Retirement Savings Vehicles

Employer-Sponsored Plans:

401(k) / 403(b): Tax-advantaged accounts with potential employer matching
Pension plans: Defined benefit plans (becoming less common)
Employee Stock Purchase Plans: Opportunities to buy company stock at a discount

Individual Retirement Accounts (IRAs):

Traditional IRA: Tax-deductible contributions, taxed on withdrawal
Roth IRA: After-tax contributions, tax-free withdrawals in retirement
SEP-IRA / Solo 401(k): For self-employed individuals

Other Investment Options:

Taxable investment accounts: No contribution limits, but no tax advantages
Health Savings Accounts (HSAs): Triple tax advantage for healthcare costs
Real estate investments: Property can provide rental income and appreciation

Contribution Strategies

Maximise Employer Matching:

Always contribute enough to your employer's retirement plan to receive the full company match. This is essentially free money and an immediate return on your investment.

Dollar-Cost Averaging:

Investing a fixed amount regularly (monthly or bi-weekly) helps smooth out market volatility and can result in better average purchase prices over time.

Gradual Increases:

Increase your contribution percentage annually, especially when you receive raises. This helps you save more without feeling the impact on your current lifestyle.

Tax-Efficient Investing:

Consider the tax implications of different account types and investment strategies to maximise your after-tax returns.

Important Considerations and Limitations

⚠️ This calculator provides estimates only:

Actual investment returns will vary significantly from year to year
Inflation will reduce the purchasing power of your future savings
Tax rates and retirement account rules may change
Your income and expenses may change over time
Healthcare costs and other expenses in retirement are not included

Professional Advice:

Consider consulting with a qualified financial advisor who can help you:

Develop a comprehensive retirement strategy
Choose appropriate investment vehicles and asset allocation
Plan for tax efficiency and estate planning
Account for inflation, healthcare costs, and other variables

Remember that retirement planning is a long-term process that requires regular review and adjustment as your circumstances change.