Retirement projection you can drag
Drag the return and the monthly contribution to redraw a balance from today to your target age. The fan either side is the same plan at 2 percentage points more and less, which on the illustrative default run spans about 35 percent below the middle line to about 60 percent above it.
Projected balance at age 65
$743,161
Paying in $500 a month at 6.0% a year. Two points either side spans $479,565 to $1,182,609.
Balance at 6.0%Same plan, 2 points either sideYour money, before growth
The starting figures are illustrative teaching numbers. Every line is arithmetic on the assumptions you set, so read the spread as a range rather than a forecast.
In short
- Drag up or down anywhere on the chart to change the expected return.
- Drag the handle on the lower track to change what goes in each month.
- Type your age, target age and current balance into the boxes under the chart.
- Read the width of the fan: that part of the answer is the return assumption, not the saving.
What the fan is
The middle line is the balance at the return you picked. The two edges are the same saving plan at 2 percentage points more and 2 points less, compounded monthly over the same years.
It is a range of assumptions, not a forecast. Nothing here predicts a return. The fan shows only what happens to the ending number when the one input nobody can pin down moves by a small amount, and 2 points is a small amount.
Why the fan gets so wide
Over a long run the return is applied to the return, so a couple of points compounds into a gap of the same order as the balance itself. At the illustrative default settings the top edge sits about 60 percent above the middle line and the bottom edge about 35 percent below, so the distance across the fan is close to the whole middle projection.
The dotted line is your opening balance plus everything paid in since, with no growth counted. The space between it and the middle line is growth. Early on almost all of the balance is your own money and the fan is narrow. Later most of it is growth and the fan is wide, which is why the return assumption matters more the longer the run.
Drag the contribution and all three edges move together, because saving more lifts every scenario at once. That is the part of the plan you decide. The width of the fan is the part you do not. To work backwards from a number you have already fixed, use the savings goal calculator.
What the projection assumes
Money goes in at the end of each month and the return is compounded monthly, which is the pattern a payroll deduction or a standing order follows.
The ending balance is in the money of today only if you enter a return net of inflation. Enter a nominal rate and the answer is in future money, which buys less. See real rate for the difference, and the compound interest calculator for the same arithmetic with a table under it.
Tax and charges come off the return, so the figure worth dragging to is the one you keep after both rather than the headline figure a fund quotes.
Common questions
Is this a forecast?
No. It is arithmetic on assumptions you choose, and the fan is a range of those assumptions rather than a prediction. Markets do not pay a steady rate either: with money going in every month, the order of the good and bad years changes the ending balance even when the average is identical. Use the tool to see which inputs move the answer, not to settle what the answer will be.
Why 2 percentage points either side?
It is small enough to be an honest disagreement between two reasonable people about a long run return, and large enough to show what that disagreement is worth. Widening the band only makes the same point louder, which is that the ending figure is an assumption with a number attached.
Should I enter a return before or after inflation?
Either, as long as you read the answer the same way. A return net of inflation gives an ending balance in what money buys today. A nominal return gives a larger number in future money. Mixing the two, by reading a nominal projection as today's spending power, is the error that makes a plan look finished when it is not.
Keep reading
This page is educational material, not financial advice. The figures come from the formula shown and assume the inputs you enter hold for the whole term. Your own rate, fees, taxes and timing will differ, so treat the output as arithmetic to check a decision against, not as a recommendation.