Q:

How do you calculate how much money you need to retire at 55 years of age?

A:

Quick Answer

CNNMoney and Charles Schwab offer free, online retirement calculators that can be adjusted according to an individual's expected retirement age. The Social Security Administration offers several online calculators, including a secure website where individuals may view their estimated retirement benefits based on their actual earnings and benefits records.

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How do you calculate how much money you need to retire at 55 years of age?
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Full Answer

CNNMoney's retirement calculator asks for an individual's current age, expected retirement age, percentage of income set aside for retirement, current salary and percentage of annual income set aside for retirement. The calculator creates a graph indicating the amount an individual needs to save for retirement and, based on the data provided, whether the individual's goals will be met. The calculator assumes the individual will live until age 92, and that he will receive Social Security benefits.

The Charles Schwab calculator asks for individual information including current age and expected retirement age, amount currently saved for retirement, tolerance for investment risk, annual household income, expected Social Security benefits and planned annual spending after retirement. The calculator displays a chart indicating an individual's expected savings at retirement and the amount needed based on his answers. The calculator also offers suggestions to increase retirement savings, including adjusting the retirement age, increasing annual savings contributions and lowering post-retirement spending.

The Social Security Administration's Retirement Estimator is based on an individual's actual Social Security earnings record. Users may log into the SSA secure website to receive a list of estimated Social Security benefits for early retirement at age 62, full retirement at age 67 and later retirement at age 70.

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