How Much Money Do You Need to Retire?

It's the biggest question in personal finance, and the answer is more knowable than most people think. It comes down to one thing you can actually estimate: how much you'll spend each year.

Start with your spending, not your salary

Your retirement number depends on your annual expenses in retirement, not your current income. Estimate what you'll spend per year once you've stopped working — housing, food, healthcare, travel, everything — and that figure drives the whole calculation.

The 25× rule of thumb

A widely used shortcut: multiply your expected annual expenses by 25. That gives you a portfolio from which you could withdraw about 4% a year — the logic behind the 4% rule. Need $50,000 a year? Aim for roughly $1.25 million. Project your own path on the retirement calculator.

What raises or lowers your number

• Other income — Social Security or a pension covers part of your expenses, lowering the portfolio you need.
• Retirement age — retiring early means more years to fund, so a bigger cushion or lower withdrawal rate.
• Healthcare — often underestimated; build in a realistic buffer.
• Lifestyle — a paid-off home and modest spending dramatically shrink the target.

How to get there

Contribute enough to capture your full 401(k) match, invest consistently in low-cost funds, and let time and compounding do the heavy lifting. The earlier you start, the smaller the monthly amount you need — because your money has more years to grow.

Run the numbers, set a target, and revisit it every year or two as your life changes. A real number on paper beats a vague worry every time.

Project your retirement

Frequently asked questions