Will You Have Enough Money to Retire? (Use This Free Tool to Find Out)

“Will I have enough money to retire?….Or will I end up broke, surviving on dog food and spam?” I joke about it, but this is a serious worry for 99% of us today, and why shouldn’t it be? Socking money away for retirement isn’t easy, and it can get pretty complicated figuring out exactly how much our monthly contributions will grow into 40 years from now.

That’s why I created this simple tool, “The Retirement Calculator.

Simply click the link and the calculator will download to your PC – you’ll see it in the lower left-hand corner of your screen once it downloads.

Will You Have Enough Money to Retire?

Will You Have Enough Money to RetireTo figure out if your money will last through your entire retirement, you’ll have to answer just five simple questions:

  1. How old are you?
  2. At what age do you want to retire?
  3. How much money is currently in your retirement accounts?
  4. How much do you contribute to your retirement funds each month?
  5. What are your current living expenses?

The first two are no-brainers. If you don’t know how old you currently are or at what age you’d like to retire, I don’t think anyone in this world can build a retirement tool simple enough for you…. so let’s move on to the next questions.

How Much Is In Your Retirement Accounts?

This current amount doesn’t have to be limited to your 401(k) account at your work. If you have money invested with a brokerage like Motif Investing or Fidelity and it’s earmarked for retirement, include that in the mix as well. Heck, even if you have equity in a real estate investment, I’d include that here too. If it’s an investment for your future and you don’t plan on buying a boat with it between now and Tuesday, then put it into this calculator so we can see what it grows to and if it will last you throughout your retirement years.

How Much Do You Contribute to Your Retirement Funds Each Month?

If you’re serious about saving for retirement, then you should most certainly be putting a set amount into your investment account each month. The absolute easiest way to do this is via a direct deposit from your paycheck. This way, you’ll never see the money, it won’t hurt as much, and you’ll be much more likely to keep your contributions going for decades.

So how much do you stash away into retirement each month? Be sure to include:

  1. Your 401(k) direct deposits
  2. Your Roth IRA contributions
  3. Stock investments
  4. Real estate investment funds

If you have multiple investments that you’re contributing to, it might be easier to calculate your average yearly contributions and then divide by 12 to figure out your monthly entry.

How Much Are Your Current Living Expenses?

When you total up your expenses each month, what’s the typical total? $2,000? $3,000? Maybe $4,000? Whatever the amount is, your expenses in retirement will likely be very similar. Sure, you might ditch your house payment before you retire, but your medical expenses and insurance costs will be far higher in your elderly years than they are now.

Inflation is another bugger you’ve got to watch out for. I’ve captured it in my tool at 3% each year (you can find it in the far right-hand column if you’re curious), so you don’t have to worry about it biting you in the butt at retirement.

So…Will You Have Enough Money to Retire?

If you haven’t already, try out the tool and find out if you’re on track for your retirement goals!

If you’re 50 years old and plan to retire at 55….but your money will only last till you’re 62, then you might want to rethink your retirement date. Either that, or you should figure out how to make bank between now and then (which can happen by the way, so don’t give up).

So what are your numbers? When do you plan to retire? And how long will your money last? I can’t wait to read all the comments on this one!

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20 comments to Will You Have Enough Money to Retire? (Use This Free Tool to Find Out)

  • jim

    There is NO WAY this calculator can possibly be correct. According to it, spouse and I can retire in 2 years, live to be 100 and then literally have millions to leave to our kids/charities. Hmm… maybe I did something wrong, but I’m pretty sure I’ve got my numbers right and I over-estimated our living expenses.

    • Hey Jim! Last we talked, you had quite a lot of money. I bet it will last longer than you think! If you’re still skeptical, shoot me an email will some stats. Thanks!

    • Hi Jim! Not sure why, but I can’t get through to the email address you left me. I checked your numbers and everything looks perfect to me. You have a huge net worth, your spend is very low, and that means your money is going to last for a very long time. Congratulations!!

  • Hey Derek. I too think that this calculator is a bit optimistic 😉 However, it may work well in some cases.

  • lee

    Is there any way that the return on investment could be altered ?

  • jim

    Derek,
    I just sent you an email with some stats. If your calculator is even close to being accurate, please let me know ’cause I am more than a little skeptical. Seriously – we started with nothing and by nothing I mean no one gave me so much as a dime for food in college. I worked construction for a few months, then paid for one semester of school (while working food service, etc for room/board) then I’d drop out and work another few months doing construction work until I had enough $ for another semester of college. It took me 7 years to get thru school (although those were really fun years – ha!) Spouse and I lived well below the poverty level while she went to law school (and never took so much as a penny in welfare – that’s just totally against how we were raised). So how these numbers on your calculator work for us is pretty much beyond our comprehension.

    Jim

    • Cool. I’ll take a look and let you know!!

    • Hi Jim. I just checked your numbers (thanks for sending them!). I had to take a guess at your age, but even with $4,000 in expenses each month (which is $48,000 a year), your retirement savings will produce more than that at 8% – which is why your retirement account will just keep growing larger and larger. Take note though, that if your investments aren’t in a Roth IRA, you should also consider that tax that you’ll have to pay when you take money out.

  • jim

    Derek,
    I just sent you an email with some stats. If your calculator is even close to being accurate, please let me know ’cause I am more than a little skeptical. Seriously – we started with nothing and by nothing I mean no one gave me so much as a dime for food in college. I worked construction for a few months, then paid for one semester of school (while working food service, etc for room/board) then I’d drop out and work another few months doing construction work until I had enough $ for another semester of college. It took me 7 years to get thru school (although those were really fun years – ha!) Spouse and I lived well below the poverty level while she went to law school (and never took so much as a penny in welfare – that’s just totally against how we were raised). So how these numbers on your calculator work for us is pretty much beyond our comprehension.

    Jim

  • Kristen

    Nice calculator but isn’t an assumption of 8% return rather high? Most experts are telling the average investor to be looking at a 5%-6% return.

    • Hi Kristen. Most advisors say 7%, and that’s after their fees. I’m a firm believer that most people should be able to invest in simple index and mutual funds themselves and earn 8% or more. I plan to earn a 10% average return (and I have been for many years).

  • Melanie

    Hi Derek,

    If one is lucky enough to have a pension that will be received upon retirement, how do you figure that in?

    Melanie

  • Nicole

    I sure hope that is correct Derek. And hopefully after paying off my house the numbers are even better. On top of that praying for excellent health for me and my siblings.

  • jim

    Derek,
    Just stepping things up a notch – a very, very little of our savings are in Roths (we’re 60’ish and Roths didn’t exist for most of our investing lives) and now that we’re in our higher earning lives we can’t afford to transfer our 401/457 funds to a roth and pay the taxes we’d be hit with at our current tax bracket.

    What do you suggest?

    Jim

    • Hi Jim. At your age you’re really at the breaking point for whether it’s worth it or not. You could look into partial roll-overs and do small portions at a time, but your company would have to be on board with that plan to do it. If I were you, I’d just enjoy my large nest egg, keep adding to it, and plan to pay the tax at withdrawal. You can’t escape the tax, so it’s either you pay it now or later.

      Derek

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