How we calculate

Markets

We simulate 1,000 possible futures, one year at a time. Each year, stocks and bonds get a random return drawn around the averages for the outlook you pick, with stocks swinging about 16% a year and bonds about 6%.

• Cautious: stocks 6%, bonds 3.5% a year, before inflation.
• Moderate: stocks 7%, bonds 4.0% a year, before inflation.
• Historical: stocks 10%, bonds 5.0% a year, before inflation.

Your stock and bond mix stays constant. Crypto and alternatives are modeled with much larger swings. The same 1,000 futures are reused for every comparison, so a change you make is measured fairly.

Spending and withdrawals

Your spending rises with inflation every year. Each year we cover it, plus the taxes it creates, in this order: income you receive (Social Security, pensions, rent, part-time work, dividends and interest), then cash, then your brokerage account, then pre-tax accounts, then Roth.

Pre-tax withdrawals before age 59½ pay the 10% early-withdrawal penalty. A plan “succeeds” if every year is fully funded until your plan-until age.

Taxes

We use 2026 federal brackets and standard deductions, rising with inflation. Long-term gains and qualified dividends are taxed at 0%, 15%, or 20%, stacked on top of ordinary income, plus the 3.8% net investment income tax above $250,000 (married) or $200,000 (single). Selling from your brokerage account only taxes the gain, based on the share of gains you told us. Stocks pay about 1.5% in dividends and bond interest is taxed as ordinary income each year.

We assume 85% of Social Security is federally taxable. States: New Jersey, New York, California, Massachusetts, Illinois, Pennsylvania, Washington are modeled with their own rules; states with no income tax are untaxed; for any other state we apply the flat rate you enter. Local taxes such as New York City's are not included.

Your number

Your number is the smallest invested amount, in today's dollars, at your retirement age, for which your plan succeeds in at least the share of futures you chose (90%, 95%, or 99%). The 4% rule figure we compare against is simply 25 times your spending.

What we simplify

• Required minimum distributions, Roth conversions, and Social Security claiming strategies are not optimized.
• Rental income is taxed as ordinary income without depreciation; a rental sale keeps 80% of its value after costs and taxes.
• A business sale keeps 75% of its value after taxes, and happens with the likelihood you chose.
• Health insurance, long-term care, and one-off expenses are only included if they're in your spending.
• Tax law is assumed to stay as it is today.