Retirement Projection

Retirement planning is not about picking a magic number - it is about the relationship between savings rate, time, and withdrawal needs. Small differences in savings rate now create enormous differences in outcomes later, and the most common projection errors are the flattering ones: nominal returns instead of real, base withdrawal rates for 40-year retirements, and forgetting healthcare before government coverage kicks in.

This is general financial education, not personalized investment, tax, or legal advice. Projections rest on uncertain assumptions about returns, inflation, longevity, and taxes.

Operating procedure

Order matters: spending comes first because it drives the nest-egg target, and offsets must be subtracted before the withdrawal-rate division - applying them afterward double-counts.

Step 1: Gather inputs

Collect, with defaults; label anything estimated as a guess:

• Current age and intended retirement age (if unknown, solve for it - that is what the calculator does).
• Current invested assets and annual savings across all accounts.
• Expected annual retirement spending in today's dollars. Default estimate: 70-80% of current pre-retirement income, reflecting lower work costs and ended savings contributions. Adjust up for planned travel and for healthcare before Medicare (or local) eligibility - the most significantly underestimated line item; adjust down for paid-off housing.
• Expected pension/Social Security income (use the official government estimator, not a guess).
• Return assumption. Use a REAL (after-inflation) return of 4-5% for a diversified portfolio; using 8-10% nominal against today's-dollar spending is the classic error that overstates readiness by a decade.