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Multiply your expected annual retirement expenses by 25. This is based on the 4% rule: if you withdraw 4% of your portfolio per year, adjusted for inflation, research shows it lasts 30+ years. For example, $60,000/year in expenses means you need $1.5 million saved. Subtract expected Social Security income first to find the gap your portfolio must cover.

Our retirement calculator does this math automatically — just enter your target income, expected Social Security, and it handles the rest. Don't forget to account for healthcare: Fidelity estimates the average retired couple needs about $315,000 for medical expenses in retirement, not covered by Medicare.

Remember the number is in future dollars. A $1.5 million target in 25 years is equivalent to about $875,000 in today's money at 2.5% inflation — which is why running the inflation-adjusted version is critical.

A common benchmark is 10–15x your final salary by retirement age. Fidelity recommends 1x salary by 30, 3x by 40, 6x by 50, and 10x by 67. The median retirement savings for Americans aged 55–64 is approximately $134,000 — significantly below what most people need, meaning many Americans are running behind on these benchmarks.

The right number is personal. It depends on your expected lifestyle, where you'll live (cost of living varies enormously), healthcare needs, how much Social Security you'll receive, and whether you have a pension. Someone who plans to live modestly in a low-cost state and has a pension needs far less than someone in a high-cost city with no other income source.

Use the retirement income calculator to work backward from your desired monthly paycheck — that gives you a personalized target rather than a generic rule of thumb.

The 4% rule states you can withdraw 4% of your portfolio in year one of retirement, adjust that dollar amount for inflation each year, and have a high probability your money lasts 30 years. It comes from a 1994 study by financial planner William Bengen who analyzed historical market returns back to 1926. A $1 million portfolio supports a $40,000 first-year withdrawal under this rule.

The rule has held up well historically across most 30-year periods, including those starting just before major downturns. However, it was designed for 30-year retirements — if you plan to retire at 50 and live to 95, you're looking at a 45-year retirement horizon where many researchers suggest a more conservative 3–3.5% rate is more appropriate.

Some planners are also cautious about the 4% rule in today's environment given lower bond yields than Bengen's historical dataset. A flexible withdrawal strategy — spending less in bad market years — tends to outperform rigid adherence to any fixed percentage.

Start as early as possible. Someone saving $400/month from age 25 accumulates roughly $1.1 million by 65 at 7% returns. Starting at 35 with the same contribution yields only $510,000 — less than half, despite only a 10-year delay. The missing $590,000 represents a decade of compound interest working against you rather than for you.

If you haven't started yet, beginning now is still vastly better than waiting. A 40-year-old who starts saving $800/month today still accumulates over $850,000 by 65. The key is starting — even $100/month invested in your 20s compounds meaningfully over time.

For workers 50 and older, the IRS allows "catch-up" contributions: an extra $7,500/year on top of the standard $23,000 401k limit in 2024. Use the 401k calculator to model how maximizing catch-up contributions affects your trajectory.

At minimum, contribute enough to capture your full employer match — that's an instant 50–100% return on that money. Beyond the match, aim for 15% of gross income total (including employer contributions). The 2024 IRS limit is $23,000 for employees under 50, or $30,500 with catch-up contributions for those 50 and older.

If you can't hit 15% today, a useful strategy is to increase your contribution by 1% each year — ideally timed to coincide with a pay raise, so you never feel the reduction in take-home pay. Most 401k plans allow automatic annual escalation for exactly this reason.

Self-employed? A Solo 401k allows contributions up to $69,000 in 2024 — both as employee and as employer, making it one of the most powerful savings tools available to business owners. Use the 401k growth calculator to see the compounding impact of different contribution levels.

For most Americans, no. The average Social Security retirement benefit in 2024 is about $1,907/month ($22,884/year), according to the Social Security Administration. Social Security is designed to replace roughly 40% of pre-retirement income for average earners — not the 70–80% most financial planners target for maintaining your standard of living.

Higher earners receive a lower replacement rate. Someone earning $120,000 in their final working years might receive $28,000–$32,000 from Social Security, replacing only 23–27% of their income. The rest must come from personal savings, which is why building a portfolio alongside Social Security is essential.

The timing of when you claim matters enormously — claiming at 62 versus 70 can mean a 77% difference in monthly benefit. Use the Social Security calculator to model different claim ages and find the break-even point for your situation.

A Roth IRA is an individual retirement account funded with after-tax money. Growth and qualified withdrawals in retirement are completely tax-free. The 2024 contribution limit is $7,000 ($8,000 if 50+). Income limits apply: single filers begin phasing out at $146,000 MAGI, fully phased out at $161,000; married filers phase out between $230,000–$240,000.

Roth IRAs are ideal when you expect higher taxes in retirement than today — often true for younger workers who are in lower brackets now. Unlike traditional IRAs, your Roth contributions (not earnings) can be withdrawn penalty-free at any time, adding flexibility that's particularly valuable for early retirees building a tax-free bridge before 59½.

Another major advantage: Roth IRAs have no Required Minimum Distributions during the owner's lifetime, making them excellent wealth-transfer vehicles. Use the Roth IRA calculator to see how tax-free compounding stacks up against a traditional account over your specific timeline.

Withdrawing from a traditional 401k or IRA before age 59½ triggers a 10% early withdrawal penalty plus ordinary income tax on the amount. On a $30,000 withdrawal in a 22% bracket, you'd lose $9,600 to taxes and penalties — receiving only $20,400. This is why early withdrawals are often described as borrowing against your future self at a terrible interest rate.

Exceptions include the Rule of 55 (separating from your employer at 55+), SEPP distributions (72(t) substantially equal periodic payments), disability, and certain medical expenses exceeding 7.5% of AGI. The Rule of 55 only applies to the 401k from your most recent employer — IRAs are separate.

Roth IRA contributions — not earnings — can always be withdrawn penalty-free, which is why many early retirement planners build a substantial Roth alongside their 401k. See the early retirement calculator for strategies to access funds before 59½ without penalty.