How to calculate your real retirement number (not the generic one)
TL;DR: Your real retirement number should account for your actual expenses (not income), a withdrawal rate appropriate to your specific retirement length, and known future changes (mortgage payoff, healthcare, a pension) — not a single flat multiple applied blindly.
Why "25x expenses" is only a starting point
The 25x figure comes from a 4% withdrawal rate assumption modeled on a roughly 30-year retirement. A longer retirement, a more conservative risk tolerance, or a lumpy future expense (a child's education, a planned move) all warrant adjusting it.
What a more complete calculation includes
- Your actual annual expenses today, adjusted for expected changes (mortgage payoff, kids leaving home)
- A withdrawal rate matched to your actual expected retirement length
- Any guaranteed income (pension, rental income) that reduces what your portfolio needs to cover
Get your actual number, calculated properly
The Retirement & FIRE Readiness Report calculates your Lean/Standard/Fat numbers and exact timeline from your real expenses and assumptions — not a flat multiple.
Calculate my number — $9.99 →Frequently asked questions
Should I use my income or my expenses to calculate my retirement number?
Expenses — retirement needs to cover what you actually spend, not what you earn. Using income overstates the target for high savers and understates it for anyone whose expenses exceed a simple income-based guess.
Does Social Security or a pension change the calculation?
Yes significantly — any guaranteed income reduces how much your own portfolio needs to generate, which can lower your target number substantially compared to assuming zero outside income.