Decision 1 · Week 1 · Wed Nov 4
How much money do I need to retire?
SHORT ANSWERThere is no single number. Your number is the gap between what you spend each month and what comes in without working, carried over the years you need it to last.
Start with three figures: your monthly spending, your guaranteed monthly income (Social Security, pensions), and the savings you plan to draw on. The gap between spending and guaranteed income is what your savings must cover.
A common rule of thumb says you can withdraw about 4% of your savings in the first year and raise that amount with inflation after. Morningstar's 2026 research put its base case a little lower: 3.9% for a 30-year retirement, assuming fixed spending and 30% to 50% in stocks. Retirees willing to cut spending in bad years can start higher.
Example: you spend $4,000 a month and Social Security pays $2,200. The gap is $1,800 a month, or $21,600 a year. At 4% that gap needs about $540,000 in savings. At 3.9% it needs about $554,000.
That is an illustration, not a prediction. Rules of thumb assume things about markets, inflation and your lifespan that may not hold for you.
In Week 1 you run this with your own numbers, in the currency you will actually spend.
Sources
- What's a Safe Retirement Withdrawal Rate for 2026? · Morningstar
- my Social Security account · Social Security Administration
Written and reviewed by Todd Allyn, Founding Director, Sovereo Intelligence
Facts checked Oct 6, 2026 · Next review by Jan 15, 2027
How we source answers · Report an error