Research by William Bengen found that withdrawing 4% of a starting portfolio in year one, then adjusting for inflation, sustained a 50/50 portfolio for at least 30 years across historical market conditions.

Some recent research suggests 3.5% is safer given today’s lower bond yields and longer retirements. The calculator lets you choose any rate to stress-test.

Does this include pensions or state benefits?

No. If you expect a pension or state pension, subtract that income from your annual expenses before calculating the nest egg needed.

Is the 4% rule still safe today?

Some recent research suggests 3.5% is safer given lower bond yields and longer retirements. The calculator lets you choose any rate to stress-test: a lower rate means a bigger nest egg but a higher chance of not running out.

Should I include my state pension?

No. If you expect a state or employer pension, subtract that annual income from your expenses first, then calculate the nest egg needed to cover only the remainder.

Finance Calculators

Retirement Nest Egg Calculator

A common retirement planning heuristic is the 4% rule: you can withdraw about 4% of a diversified portfolio in the first year of retirement and adjust for inflation thereafter, with a good chance the money lasts 30 years. This calculator turns your expected annual expenses into a target nest egg using a withdrawal rate you choose.

Enter the annual income you want in retirement and a withdrawal rate (4% is the classic default). The result is the portfolio size that would support that spending, and the first-year withdrawal it implies.

Use it to translate a vague retirement income goal into a concrete savings target, and to stress-test how a safer withdrawal rate changes the number.

Annual expenses in retirement

Withdrawal rate%

Currency

Enter your values to see the result.

How this is calculated

This calculator applies the withdrawal-rate approach to retirement planning. The idea, popularised by financial adviser William Bengen in the 1990s, is that withdrawing a fixed percentage of your starting portfolio in the first year of retirement, then adjusting that dollar amount for inflation each year, has historically sustained a diversified portfolio for around 30 years. The target nest egg is simply your desired annual expenses divided by the withdrawal rate you choose: nest egg = expenses ÷ withdrawal rate.

The classic default is a 4% withdrawal rate, which implies a nest egg of 25 times your annual expenses. A lower rate (3% or 3.5%) demands a larger nest egg but is more resilient to market downturns and longer retirements; a higher rate is riskier. The first-year withdrawal equals the annual expenses you entered.

The model assumes a steady withdrawal, a roughly 30-year retirement, and a diversified portfolio. It does not account for state pensions or employer pensions (subtract those from your expenses first), taxes on withdrawals, sequence-of-returns risk, variable spending, or longevity beyond 30 years. Recent research on lower bond yields suggests 4% may be optimistic for some, which is why the rate is adjustable here.

Worked example

You want $40,000 of annual income from your portfolio and choose a 4% withdrawal rate.

1Nest egg = expenses ÷ withdrawal rate = 40,000 ÷ 0.04 = $1,000,000.
2First-year withdrawal = $40,000 (then adjusted for inflation in later years).
3The same $40,000 at a safer 3.5% rate would need 40,000 ÷ 0.035 = $1,142,857.

Frequently asked questions

What is the 4% rule?: Research by William Bengen found that withdrawing 4% of a starting portfolio in year one, then adjusting for inflation, sustained a 50/50 portfolio for at least 30 years across historical market conditions.
Is 4% still safe?: Some recent research suggests 3.5% is safer given today’s lower bond yields and longer retirements. The calculator lets you choose any rate to stress-test.
Does this include pensions or state benefits?: No. If you expect a pension or state pension, subtract that income from your annual expenses before calculating the nest egg needed.
Is the 4% rule still safe today?: Some recent research suggests 3.5% is safer given lower bond yields and longer retirements. The calculator lets you choose any rate to stress-test: a lower rate means a bigger nest egg but a higher chance of not running out.
Should I include my state pension?: No. If you expect a state or employer pension, subtract that annual income from your expenses first, then calculate the nest egg needed to cover only the remainder.

Related calculators

Method: withdrawal-rate rule of thumb (Bengen 4% rule). No external data source. Last updated: September 2026.

These results are indicative estimates for planning only and do not constitute financial advice. Actual loan terms, tax rules, investment returns and product conditions vary by country, provider and your personal circumstances. Always confirm figures with your bank, tax authority or a qualified financial adviser before making decisions.