Use this calculator to determine how much monthly income your retirement savings may provide
you in your retirement. Your annual savings, expected rate of return, and your current age all
have an impact on your retirement's monthly income. Click View Report to see a year-by-year
breakdown of your retirement savings.
Definitions
Starting balance
Initial balance that you have in your retirement accounts.
Annual contributions
The amount you will contribute to your retirement savings each year. This
calculator assumes that you make your contribution at the beginning of each
year. This should reflect the total you save toward your retirement. This
should include any 403(b), 401(k), or 457(b) plans and your employer
contributions to these plans. It should also incude any other retirement
accounts such as an IRA or a Roth IRA and any retirement savings in
non-retirement accounts. This calculator assumes that you make one
annual contribution at the start of each year, and any withdrawals happen once
per month at the beginning of each month.
Current age
Your current age.
Age of retirement
Age you wish to retire. This calculator assumes that the year you retire,
you do not make any contributions to your retirement savings. So if you retire
at age 65, your last contribution happened when you were actually age 64.
Rate of return before retirement
This is the annual rate of return you expect from your investments before
taxes. The actual rate of return is largely dependent on the type of
investments you select. From January 1970 to December 2006, the average
compounded rate of return for the S&P 500, including reinvestment of
dividends, was approximately 11.5 percent per year (source:
www.standardandpoors.com). During this period, the highest 12-month return
was 61 percent, and the lowest was -39 percent. Savings accounts at a bank
pay as little as 1 percent or less.
It is important to remember that future rates of return can't be
predicted with certainty and that investments that pay higher rates of
return are subject to higher risk and volatility. The actual rate of return
on investments can vary widely over time, especially for long-term
investments. This includes the potential loss of principal on your
investment. It is not possible to invest directly in an index, and the
compounded rate of return noted above does not reflect additional sales
charges and fees that funds may charge.
Rate of return during retirement
This is the annual rate of return you expect from your investments during
retirement. It is often lower than the return earned before retirement due
to more conservative investment choices to help insure a steady flow of
income. The actual rate of return is largely dependent on the type of
investments you select. From January 1970 to December 2006, the average
compounded rate of return for the S&P 500, including reinvestment of
dividends, was approximately 11.5 percent per year (source:
www.standardandpoors.com). During this period, the highest 12-month return
was 61 percent, and the lowest was -39 percent. Savings accounts at a bank
pay as little as 1 percent or less.
It is important to remember that future rates of return can't be
predicted with certainty and that investments that pay higher rates of
return are subject to higher risk and volatility. The actual rate of return
on investments can vary widely over time, especially for long-term
investments. This includes the potential loss of principal on your
investment. It is not possible to invest directly in an index, and the
compounded rate of return noted above does not reflect additional sales
charges and fees that funds may charge.
Current tax rate
Your current marginal tax rate you expect to pay on your taxable
investments.
Retirement tax rate
The marginal tax rate you expect to pay on your investments at
retirement.
To increase deposits with inflation checkbox
Check this box if you wish to have your annual contribution increased each year
to keep up with inflation.
If savings is tax-deferred checkbox
Check this box if your retirement savings is being deposited into a
tax-deferred account. This includes an IRA, 401(k), 403(b), governmental 457(b),
variable annuity, or other tax-deferred investment.
Information and interactive calculators are made available to you as
self-help tools for your independent use and are not intended to provide investment advice. We
can not and do not guarantee their applicability or accuracy in regards to your individual
circumstances. All examples are hypothetical and are for illustrative purposes. We encourage
you to seek personalized advice from qualified professionals regarding all personal finance
issues.
Note: The above information is not intended or written to be used as
legal or tax advice. It was written solely to support the sale of annuity products. As a
taxpayer, you cannot use it for the purposes of avoiding penalties that may be imposed under
the tax laws. You should seek advice on legal or tax questions based on your particular
circumstances from an independent attorney or tax advisor.
