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Retirement & Planning
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Estimating Your Savings Goal

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Get retirement help

Call us at 888-213-4695 or visit your local branch.

How much money do you need to retire? Follow the four steps below to get clear on how much you’ll need to fund the type of retirement you want.

Project the amount of savings you'll need.

Step 1:

Estimate how much you expect to spend annually.

Start by using our budget planner.

While everyone's situation during retirement is different, a safe approach is to plan on needing the same amount of income you have today. Add up all of your essential annual expenses, including housing, health care, food, utilities, and taxes. Then estimate discretionary expenses such as travel, gifts, dining out, hobbies, and recreation.

Certain costs, such as mortgages and work-related expenses, may decrease in retirement; others, such as health care costs and travel, may increase.

Step 2:

Calculate your expected annual income.

Add up your estimated income from predictable streams of income such as Social Security, annuity payments, pensions, and any rental income you may be receiving. Don't include potential income that could be generated from your retirement investments.

It may be easiest to calculate this monthly and then multiply by 12 to get an annual amount.

Step 3:

Calculate the annual income
you'll need from your portfolio.
  • Estimate your annual spending, including taxes (from Step 1).
  • Subtract your non-portfolio income (from Step 2).
  • Subtract the appropriate level of estimated income tax you'll need to pay.

Step 4:

Estimate how large your portfolio needs to be.

According to the Schwab Center for Financial Research, your retirement portfolio should be 25 times larger than the amount you expect to withdraw from it in your first year of retirement.¹

Example: Estimate Your Needs

Total projected annual expenses in first year of retirement (including taxes)
$90,000
Minus predictable income (e.g., Social Security, pension, rental income)
($40,000)
= Annual amount you’ll need to withdraw from your portfolio
$50,000
x 25
Retirement portfolio target goal:
$1,250,000


 

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888-213-4695.