Practical guide
Understanding retirement savings projection — two-scenario comparison
Everyday editorial team · GEOINNOVATION CO., LTD · Published · Updated
What this calculation is for
A retirement-savings projection translates today’s balance and recurring contributions into a possible future fund. It is most useful as a range of scenarios rather than a single promise. Try lower returns, a later contribution start and higher inflation before deciding whether a plan is resilient.
How the method works
The model compounds the entered balance, adds scheduled contributions and compares nominal dollars with an inflation-adjusted balance. An illustrative withdrawal percentage converts the projected balance into annual income. Neither the return nor the withdrawal percentage is guaranteed.
A worked example
A projected $1,000,000 portfolio supports a $40,000 first-year draw at a 4% assumption before tax. If retirement is many years away, $40,000 then has less purchasing power than $40,000 today.
Assumptions and real-world differences
Constant returns hide market volatility and sequence risk. Contribution limits, tax treatment, benefit eligibility and future Social Security payments are not automatically determined. Employer contributions are included only where the tool provides a matching field.
Building two independent scenarios
Scenario A and Scenario B each have a complete set of inputs for this retirement savings projection calculation. Change several inputs in B when comparing genuinely different plans, then inspect the B-minus-A headline difference and the detailed rows. When multiple inputs change, the total difference cannot be attributed to just one of them.
Reproduce this tool’s example
These fixed example inputs are independent of edits you make above. Enter them in this tool to reproduce the result, then replace them with your own assumptions.
- Scenario A — Current age
- 35 years old
- Scenario A — Target retirement age
- 65 years old
- Scenario A — Current retirement savings
- 80,000 $
- Scenario A — Monthly personal contribution
- 700 $
- Scenario A — Monthly employer match
- 250 $
- Scenario A — Assumed annual return
- 6 %
- Scenario A — Annual inflation assumption
- 2.5 %
- Scenario B — Current age
- 44 years old
- Scenario B — Target retirement age
- 65 years old
- Scenario B — Current retirement savings
- 80,000 $
- Scenario B — Monthly personal contribution
- 700 $
- Scenario B — Monthly employer match
- 250 $
- Scenario B — Assumed annual return
- 6 %
- Scenario B — Annual inflation assumption
- 2.5 %
Scenario B result: $740,287.99
Scenario A: $1,385,266.62. Projected retirement balance.
- Scenario A main result: $1,385,266.62
- Scenario B main result: $740,287.99
- Numeric difference (B − A), in result units: -644,978.63
Frequently asked questions
- Is the 4% illustration a safe-income guarantee?
- No. Outcomes depend on time horizon, markets, fees, taxes and spending flexibility.
- Why show today’s dollars?
- It separates projected nominal growth from the purchasing power lost to inflation.
- Why is this different from the one-factor comparison?
- The one-factor tool changes only current age. This version lets all model inputs differ, so it is more flexible but does not isolate the effect of any single change.