Calculating retirement income

There are many factors to consider when you calculate how much you’ll need in retirement or how long your current savings are likely to last. This article will walk you through how these calculations work and will provide you with an interactive retirement savings calculator to find out where you stand. 

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How to make retirement income calculations

Each person has a different idea of what retirement should look like, and it’s normal to be concerned about your savings. Is the retirement you imagine realistic? In order to find out, we must do some math.

63% of Americans are worried about not having enough money for retirement.¹

It’s never too early, or too late, to start planning for retirement. When looking at the big picture, it’s imperative to figure out where your current finances stand. From there, you can begin to make adjustments, if needed, to help you reach your goals. When calculating your retirement income, there are a few things you’ll need to know, including current savings, your ideal retirement age, and how much of your current salary you’d like to retain each year. Then, you can calculate your own outlook with our retirement savings calculator below.

Your current age matters

Ideally, we would all start saving for retirement at as young an age as possible. The way that interest compounds on investments makes $5 saved at age 20 far more valuable than $5 saved at age 40. When calculating your retirement income, your age today will tell us how long your current and future investments have to continue growing.

Projected retirement age and retirement length

Most people would like to retire sooner rather than later; however, when you retire can have implications on how long your retirement savings will last. The later you plan to retire, the longer you’ll be able to save. Each year you continue to work is another year you can put away more savings for retirement. In addition, it’s another year that you won’t be depleting your savings. So, in essence, each year you continue to work counts double. And there’s an added bonus: Each year you work past your full retirement age, up to age 70, you will get an 8% increase in your Social Security benefit.2 For those who retire early, the amount of your Social Security benefit will be reduced by 30% if you start to collect Social Security at age 62 rather than at your full retirement age. But the reduction is less drastic with each extra year you work up to your full retirement age.3

Current savings, and savings per year

To see how much retirement income you’ll have, we’ll need to start with how much you currently have saved. However, since retirement savings grow year over year, the money you have saved today will likely grow considerably before you retire. In addition, we’ll factor in how much you plan to save per year in the future.

Assumed Rate of return on your investments

Not all investments have the same targeted rate of return. Generally speaking, the higher the potential gain, the higher the risk. A broad-based index fund is relatively less volatile but performs more  evenly, while individual stocks and some targeted mutual funds have the potential to grow more rapidly but carry more risk. The key to a robust retirement savings portfolio is diversification. Many investors target an annual rate of return in the neighborhood of 10%, but depending on your situation and risk tolerance, you may have a higher or lower target. Alternatively, there are also ways to have guaranteed income throughout retirement. In addition to social security, you may have a pension from former employers. Or, as you are entering retirement, you could purchase an income annuity, guaranteeing monthly payments for as long as you live.5


Calculate your retirement income

This calculator will help you get a picture of your projected retirement income based on your current savings, projected return, and retirement goals. You’ll need just a few pieces of information, as outlined above. Remember that this is just an estimate. You can examine different scenarios to see how a different retirement age or rate of return might affect your outcome. Plus, there are many things that can change your calculation in the future. A higher salary, an inheritance, or purchasing a home may significantly change your outlook.

I'm retired, how long will my savings last?

Savings in Retirement Calculator

We're here to help you better understand your total income and expenses in retirement.


  • Income Needs
  • Social Security
  • Pension
  • Other Income
  • Savings

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Looking at Social Security.

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Let's talk about your savings.

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The results are hypothetical based on your input. Your actual results will vary. Any rates of return used are for illustrative purposes only and does not represent performance of any actual financial vehicle/strategies.

Get help saving for retirement

Now that you have a better idea of where you might stand, you probably have even more questions. Planning for retirement can be challenging. There are a lot of things to keep in mind, like bills, health events, and a legacy for your loved ones. The good news is that you don’t have to figure everything out for yourself. If you’d like to discuss your plans and develop a custom retirement strategy, a financial services professional can help.

What is a good monthly retirement income?

That really depends. If you want to retire to the serenity of the woods, you’re going to need a very different nest egg than if you want to travel the world or live in a major city. Generally, most financial advisors recommend targeting about 80% of your pre-retirement income. Remember, that includes other forms of income you might have in retirement, like Social Security or a part-time job.

What is the average monthly Social Security check?

Social Security differs from person to person, depending on the age of retirement and how much was earned over the years, but the average Social Security benefit in June 2022 was $1,542 per month.6 For many people, that isn’t enough to live on, but it can certainly help stretch your retirement savings.

Are there other ways to generate income in retirement?

Yes. Depending on your situation, there may be other ways to ensure that you have income throughout your golden years. Some investments pay consistent dividends. Income annuities can give you a stable, guaranteed income for life. Or you may choose to continue working part-time. If you’re concerned about meeting your retirement goals, a financial services professional can help you get on track.

How can I best save for retirement?

Wherever you are on your financial journey, the best thing to do is to start saving as soon as you can, even if it’s only a little bit here and there. Getting into the habit of saving now will have nothing but beneficial effects on your future, both tomorrow and in your golden years.

Note, all investments involve risk, including loss of principal. Investments are offered through NYLIFE Securities LLC (member FINRA/SIPC), a Licensed Insurance Agency and a New York Life Company.


Discuss your retirement goals with a financial professional.

We provide a broad range of  products and solutions to help guide your strategy.

1Lydia Saad, “Americans’ Financial Worries Tick Up in Past Year,” Gallup, May 9, 2022.

2Delayed Retirement Credits,” Social Security Administration.

3Starting Your Retirement Benefits Early,” Social Security Administration. 

4Diversification does not assure a profit or protect against market loss.

5Guarantees are based upon the claims paying ability of the issuing insurance company.
6Monthly Statistical Snapshot, June 2022,” Social Security Administration, July 2022.