Retirement Corpus Calculator

Real Return Is What Decides The Answer

A 5% return with 3% inflation is not a 2% return - it is (1.05 / 1.03) - 1, or 1.94%. That gap between your return and inflation is the only thing that funds a rising income. Halve the real return and the corpus you need roughly rises by a third; push the real return to zero and the corpus becomes simply your annual spending multiplied by the years you must fund.

Why This Differs From The 4% Rule

• The 4% rule is a shortcut: corpus = annual spending x 25
• It assumes a 30-year retirement and a specific US stock and bond mix
• This page prices your actual retirement length and your own return assumption
• A shorter retirement or a higher real return justifies a smaller multiple - and the reverse
• Use the 4% rule as a sanity check, not as the plan

Sequence-Of-Returns Risk

Averages hide the danger. Two retirees can earn the same average return and end up in completely different places if one meets a bad market in their first few years, because they sell assets at low prices to fund withdrawals. This is why planners hold one to three years of spending in cash at retirement, and why a plan that only just balances on paper is not really funded.

Time Beats Amount

• Money invested at 30 has roughly twice as long to compound as money invested at 45
• At an 8% return, a dollar saved 25 years out becomes about $6.85; 10 years out it becomes about $2.16
• Raising contributions with each pay rise is the least painful way to close a gap
• Delaying retirement adds saving years and removes funded years at the same time
• Cutting planned spending by 10% cuts the required corpus by 10% straight away