Think of those days when you can sleep in and spend the day doing whatever you want. To get there you need to plan how much money you’ll need to live on when you retire.

There isn’t a “one size fits all” method for calculating this amount; there are many factors to consider. For example, how much have you saved thus far? At what age do you wish to retire? Do you want to maintain your current lifestyle or are you planning to spend less? How much financial risk are you willing to take with your investments? You’ve also got to factor in the rate of inflation at the time of your retirement — it generally runs between 2% to 3%, but unexpected events, like a war and a pandemic, can obviously affect that figure.

There are many personal finance calculators available online to help you estimate your retirement goal and how to much you’ll need to save each year. They are usually set up so you can modify the assumptions to suit your circumstances and run different scenarios. offers a free simple calculator, but there are many others to choose from. The calculators allow you to enter different figures for different scenarios and decide how comfortable you are with each path.

But let’s run one scenario to give you a general idea of how much you will need to save by retirement age. Say you are 40 and want to retire at 67. Your current income is $60,000 and you want to maintain 75% of your current lifestyle. At retirement, you’ll need approximately $650,000 to support yourself for your remaining years.

That’s a lot of money but remember, the earlier you start saving, even a small amount, the longer your money will have to grow!