When it comes to retirement planning, "How much do I need?" is the million-dollar question—sometimes quite literally.
The truth is, there is no single "magic number" that works for everyone. The amount you need to save depends entirely on how you want to live and when you plan to stop working.
However, you don't have to guess. By understanding a few simple financial models, you can calculate an accurate target for your own lifestyle. In this guide, we'll break down the most reliable rules of thumb and show you how to find your target number using our **Free Retirement Calculator**.
The Rule of 25 (The 4% Rule)
If you only remember one concept from this guide, make it The Rule of 25.
Originating from the famous "Trinity Study," the Rule of 25 states that to retire comfortably, you need to save 25 times your anticipated annual retirement expenses.
Once you have that amount saved and invested optimally, you can theoretically withdraw 4% of your portfolio every year (adjusted for inflation) without ever running out of money over a 30-year retirement.
How to Calculate It
In this scenario, your target retirement number is $1.5 million.