Project your retirement nest egg and see your estimated monthly income in retirement.
The 4% rule, established by the Trinity Study in 1998, suggests that you can withdraw 4% of your retirement portfolio annually (adjusted for inflation) with a high probability of your money lasting 30 years. For example, if you need $40,000/year in retirement, you need a nest egg of $1,000,000 ($40,000 ÷ 0.04). While some experts now recommend a more conservative 3.5% or 3% withdrawal rate due to longer life expectancies and lower expected returns, the 4% rule remains a widely used starting point for retirement planning.