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How Much Do I Need to Retire? (Using the 25x Rule)

A simple guide to estimating how much money you may need for retirement based on your lifestyle, spending, and long-term goals.

The short answer

Many people aim to replace about 70% to 80% of their pre-retirement income. A common rule of thumb is to save 25 times your annual expenses.

What affects how much you need?

Your retirement number depends on your lifestyle, spending habits, and how long you expect to be retired. Some key factors include:

  • Monthly living expenses
  • Healthcare costs
  • Debt or mortgage
  • Travel or lifestyle choices
  • Inflation over time

The 4% rule (simple explanation)

The 4% rule suggests you can withdraw about 4% of your savings each year in retirement. For example, if you want $40,000 per year, you may need around $1,000,000 saved.

Example

If you expect to spend $50,000 per year in retirement, multiplying that by 25 suggests a goal of around $1.25 million in savings.

Use our calculators

Want a more personalized estimate? Try these tools:

Final thoughts

There is no one-size-fits-all number for retirement. The best approach is to estimate your expenses, test different scenarios, and adjust your plan over time.

Use a calculator to test your number

Once you have a rough estimate, you can test different scenarios using the calculators on this site. Try adjusting your savings, withdrawal rate, and timeline to see how your plan holds up.

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