Retirement Income Calculator

Read our Advertiser Disclosure.
Contributor, Benzinga
February 22, 2024

Calculate Your Monthly Retirement Income

Saving for retirement is complex, and you might have pockets of money in various places to take advantage of pre- and post-tax savings. Using a retirement income calculator can help you understand how you’re doing based on your age, income and savings cadence. 

You’ll need several pieces of information before completing the calculation, which can tell you whether you need to increase your retirement savings contributions, adjust your investment strategy or plan to work past the standard age of 65 to build a comfortable retirement lifestyle. Follow these steps to gain an understanding of where you are and where you can improve in your retirement preparations.


The retirement calculator requires several key pieces of information that help inform how you’re doing with retirement savings. Here’s a look at how to use the tool to plan for retirement.


Your age offers insights as to how long you have before you might retire. For example, if you’re 30 and want to retire at 65, the calculator will know you have about 35 years before retirement. This will also indicate the approximate amount you should have saved already or if you have a gap where completing some catch-up contributions could help get you back on track.

Annual Income

Your annual income offers insights into your lifestyle, expenses and expectations. Someone making $50,000 per year will have a different way of life than someone making $100,000 a year. This provides the calculator with a rough estimate of monthly income so it knows how much you need to retire. Most people don’t want to scale back their lifestyle in retirement so knowing how much you’re used to making can help in providing insights into what you’ll need to feel comfortable once you stop working.

Retirement Savings to Date

Knowing how much you have saved already will help the calculator estimate retirement income. It uses estimates based on your investment mix to know how much interest and dividends you’ll earn in the years between now and retirement to know how much money will be in the bank at that time. If you find your retirement savings to date are insufficient for your lifestyle, you’ll know much to start contributing regularly to get where you need to be.

Monthly Retirement Savings

Inserting your existing savings rate per month will help the calculator know how your savings are growing month over month. That way, you can see whether you need to contribute more each month to meet your goals or whether you’re doing an adequate job in your contributions. If you aren’t sure how much is going into your savings, check your pay stubs or log into your retirement account to calculate your monthly contributions alongside your employer’s, if applicable.

Retirement Age

It might be hard for you to know when you want to retire, but entering an estimate will help you get an accurate view of your savings and how it will stack up. You can also play around with this calculation to see how far your savings will stretch if you wait to retire a little later. Or if you want an early retirement, you can test to see what that will look like or whether you’ll need to adjust your lifestyle to achieve an early retirement.

Investment Style

Some people are more comfortable with risk than others. Age is another factor when determining investment style. The older and closer to retirement you get, the more conservative your investment style is likely to be. But if you’re a generally risk-averse person, your investment style might be conservative even from a young age to help protect your funds from downturns in the stock market or major economic fluctuations. Providing the calculator with these details will help it know how to estimate your retirement income.

How Do I Calculate My Retirement Income?

You should regularly calculate retirement income based on your current savings rates and lifestyle preferences. This will help ensure you stay in line with your lifestyle preferences once the time comes to retire. You’ll follow several steps to calculate this income manually.

  1. Review your pretax income: Check your pay stubs for your total income before taxes or expenses, like health insurance or parking. When completing this calculation, be sure to include all income sources, including side hustles.
  2. Add up your existing retirement savings: Log into all retirement savings accounts to find your total retirement savings. This includes employer-sponsored 401(k) plans as well as individual retirement accounts (IRAs) and other investment vehicles.
  3. Calculate Social Security: If you’ve been paying into Social Security, review what your estimated monthly payout will be in retirement.
  4. Find your existing monthly contribution amount: While you’re reviewing your investment accounts, add up how much you and your employer are contributing to your account monthly. Ideally, you should be contributing 10% to 15% of your pretax income.
  5. Calculate how much you’ll need each month in retirement: To do this, you’ll need to review your existing expenses and see how they might change in retirement. For example, you can estimate healthcare expenses based on premiums for Medicare compared with what you currently pay each month. And consider whether your mortgage will be paid off by the time you retire and how much travel you hope to do. This will tell you whether you need the same amount each month as you’re currently making or can scale up or down a bit.
  6. Estimate your rate of return: Look at your retirement accounts to see your average rate of return on your investments. You’ll use this to compound your account balances year over year while factoring in monthly contributions. This is by far the hardest part of manually calculating your retirement income because it’s a complex calculation. That’s why using one of the best retirement planning apps or calculators is a better route.
  7. Divide your total account balance at your retirement age by the number of months you’ll likely use it: Now that you know how much you’ll have saved by your retirement age, you can see how that income will serve you in retirement. For example, if you save $1 million toward retirement and retire at age 65 and the average life expectancy is 77.5 years, you’d have $6,666 per month without factoring in continued account growth for the money left in the account during your retirement years.

Because many factors affect your retirement income and the math is complex when evaluating how to calculate retirement income, it’s better to use a tool or turn to your financial adviser for insights.

Advantages of Utilizing Retirement Income Calculators

Using a retirement calculator offers many great advantages. Here’s a look at some of those:

  • Estimated monthly income so you can decide whether that makes a comfortable lifestyle
  • Easy way to move numbers around to see how the total changes when you make adjustments to savings rates
  • Fast, easy way to check in on your retirement savings
  • Simple to use regularly or when you go through a major life event, such as a job change, relocation or new home
  • Helps plan for what-if scenarios
  • Aids in staying on track with retirement savings at all phases of life
  • Can guide you toward changing your strategy to find the best investments for retirees to achieve your goals

Disadvantages of Retirement Income Calculators

While you’ll gain many benefits from using a calculator to estimate your retirement income based on current factors, be aware of these disadvantages:

  • Can’t replace working with a financial adviser to review your income and needs with an expert
  • Doesn’t factor in special situations, like helping pay for a child’s college, work disruptions or job loss
  • Won’t factor in career growth and advancements you’re hoping to achieve over the years, which will increase your lifestyle and might lead to great monthly retirement savings contributions
  • Can’t use family data and history to know your estimated life expectancy
  • No entry for unusual expenses, such as caring for a family member long-term or additional household members who are not contributing toward a retirement account

How Much Do I Need to Retire?

The dollar amount you need for retirement will vary based on your financial situation. But some general guidelines to check how you’re doing saving toward retirement include these saving amounts:

  • Your salary by age 30
  • 3 times your salary by age 40
  • 6 times your salary by age 50
  • 8 times your salary by age 60
  • 10 times your salary by age 67

Use those calculations to see how you’re doing, and then make a plan to catch up to those calculations by each benchmark.

Staying on Track for Retirement Savings

The best way to stay on track toward your retirement savings is to ensure you know how to calculate retirement income and review your savings status regularly. Spend some time doing some calculations to ensure you’ll have what you need to enjoy your hard-earned retirement.

About Rebekah Brately

Rebekah Brately is an investment writer passionate about helping people learn more about how to grow their wealth. She has more than 12 years of writing experience, focused on technology, travel, family and finance. Her work has been published in Benzinga, Hearst Bay Area, FreightWaves and Dallas Observer publications.