Why is my readiness score higher than my funding ratio?

Because the score is not purely the funding ratio. It starts from projected savings divided by required savings, then adds ten points for having any current savings, ten for contributing at all and five for having an employer match. A score of 82 can sit on a funding ratio near 57%, so read the shortfall figure rather than the score.

Does this account for tax?

No, not at any point. Contributions are treated identically whether they go to a traditional or Roth account, growth is untaxed in the projection, and withdrawals are not reduced for income tax. A traditional 401(k) balance is worth meaningfully less after tax than the number shown.

How is the employer match modelled?

As a percentage uplift on your own contribution, so a 50% match turns $500 into $750 a month. Real plans usually match a percentage of salary up to a cap, so if your match is capped below what you contribute, enter a lower effective percentage.

What is the four percent rule and should I trust it?

It is the convention that withdrawing four percent of a portfolio in the first year of retirement, adjusted for inflation afterwards, has historically lasted about thirty years. It is a rule of thumb from historical US market data, not a guarantee, and it is more optimistic for a longer retirement than a shorter one.

Is the Social Security estimate adjusted for inflation?

No. Your desired income is inflated to your retirement year, but the Social Security figure is subtracted exactly as entered. If you typed a today-dollars estimate, the tool is treating it as a future amount, which makes the required savings figure conservative.

Does it model market crashes or varying returns?

No. It applies the same return every single year. Real markets deliver returns in an uneven sequence, and a bad run in the first years of retirement damages a portfolio far more than the same average return delivered smoothly.

Are these US retirement accounts?

The tool is written around US conventions, including 401(k) style employer matching and Social Security, in US dollars. TaxEase also provides tax and compliance services in Pakistan, which is an entirely separate offering and not modelled here.

Retirement Calculator: Projected Savings and Shortfall

Retirement Calculator: Projected Savings and ShortfallThe Retirement Calculator is a free browser-based tool that projects what your retirement savings will grow to and compares that against the amount your target retirement income would require. It compounds your existing balance and your monthly contributions, including an employer match, at the return you specify, inflates your desired income to the year you retire, and applies a four percent withdrawal rule to work out the pot you would need. You get a projected balance, a required balance, the gap between them, a sustainable monthly income and a readiness score. It ignores tax entirely.

What people use it for

Finding out whether the current contribution is enough

A thirty-year-old saving $500 a month with a fifty percent employer match projects to about $1.62 million by sixty-five at a seven percent return. Against a $4,000 monthly income target inflated over thirty-five years, the tool says roughly $2.84 million is needed, a gap of about $1.22 million that is far better discovered now than at fifty.

Valuing an employer match properly

Running the same numbers with and without the employer match shows how much of the final balance the match is responsible for. For most people it is the highest-return element of the whole plan, and seeing it quantified is what turns contributing up to the match from advice into action.

Testing a more cautious return assumption

Someone using seven percent can rerun at five and watch the projection fall sharply. Because returns compound across decades, a two-point difference in assumption changes the answer more than most contribution decisions do, which is a good argument for planning against the pessimistic figure.

Deciding whether working three more years fixes the gap

Moving the retirement age from sixty-two to sixty-five adds contributions, adds compounding years and shortens the retirement to be funded. Running both scenarios shows how much of the shortfall those three years actually close before the decision is made.

How it works

Enter your ages Current age, retirement age and life expectancy. Retirement age must exceed your current age and life expectancy must exceed retirement age, or the tool will refuse to calculate.
Enter savings and contributions Your current retirement balance, your monthly contribution, and the employer match as a percentage. The match is applied as an uplift on your contribution rather than a percentage of salary.
Set your investment assumptions Expected annual return and expected inflation. The return compounds your balance while inflation is used to raise your target income to what it will cost in the year you retire.
Enter your retirement goals The monthly income you want in today dollars, and your Social Security estimate. The income figure is inflated to your retirement year, while the Social Security figure is subtracted as entered.
Press Calculate You get projected savings, a readiness score, sustainable monthly income under the four percent rule, the savings breakdown between contributions and growth, and a year-by-year table.
Change one input at a time Rerunning with a single variable changed shows which lever actually moves the outcome. Usually it is the contribution and the retirement age rather than the return assumption you can influence.

Worked examples

Input: Age 30, retiring at 65, life expectancy 85, current savings $25,000, $500 a month, 50% employer match, 7% return, 3% inflation, $4,000 desired monthly income, $1,800 Social Security.

Result: Projects about $1.62 million against a required $2.84 million, a shortfall of roughly $1.22 million, with sustainable monthly income of about $7,192. The readiness score reads 82 even though the funding ratio is only about 57%.

Input: Age 45, retiring at 65, life expectancy 85, current savings $120,000, $1,000 a month, no employer match, 6% return, 3% inflation, $5,000 desired monthly income, $2,000 Social Security.

Result: Projects about $846,900 against a required $2.11 million, leaving a gap of about $1.26 million. Sustainable monthly income of about $4,823 against an inflated target of about $9,031.

Frequently asked questions

Why is my readiness score higher than my funding ratio?: Because the score is not purely the funding ratio. It starts from projected savings divided by required savings, then adds ten points for having any current savings, ten for contributing at all and five for having an employer match. A score of 82 can sit on a funding ratio near 57%, so read the shortfall figure rather than the score.
Does this account for tax?: No, not at any point. Contributions are treated identically whether they go to a traditional or Roth account, growth is untaxed in the projection, and withdrawals are not reduced for income tax. A traditional 401(k) balance is worth meaningfully less after tax than the number shown.
How is the employer match modelled?: As a percentage uplift on your own contribution, so a 50% match turns $500 into $750 a month. Real plans usually match a percentage of salary up to a cap, so if your match is capped below what you contribute, enter a lower effective percentage.
What is the four percent rule and should I trust it?: It is the convention that withdrawing four percent of a portfolio in the first year of retirement, adjusted for inflation afterwards, has historically lasted about thirty years. It is a rule of thumb from historical US market data, not a guarantee, and it is more optimistic for a longer retirement than a shorter one.
Is the Social Security estimate adjusted for inflation?: No. Your desired income is inflated to your retirement year, but the Social Security figure is subtracted exactly as entered. If you typed a today-dollars estimate, the tool is treating it as a future amount, which makes the required savings figure conservative.
Does it model market crashes or varying returns?: No. It applies the same return every single year. Real markets deliver returns in an uneven sequence, and a bad run in the first years of retirement damages a portfolio far more than the same average return delivered smoothly.
Are these US retirement accounts?: The tool is written around US conventions, including 401(k) style employer matching and Social Security, in US dollars. TaxEase also provides tax and compliance services in Pakistan, which is an entirely separate offering and not modelled here.

Tips

Contribute at least enough to capture the full employer match before optimising anything else. It is the one return in the projection that is not a market assumption.
Rerun the projection at a lower return than you expect. Plans built on optimistic returns fail quietly for decades before the problem becomes visible.
Treat the shortfall figure, not the readiness score, as the real output. The score is inflated by points awarded for simply having a plan.
Revisit the numbers whenever your income changes. A contribution set years ago rarely still reflects what you could comfortably save today.

Written by Ahsan Mahmood. Last updated 2026-07-21. This calculator runs entirely in your browser and produces estimates, not tax advice.TaxEase — Retirement Calculator: Projected Savings and Shortfall