Savings Rate Calculator
Calculate your personal savings rate and discover how it impacts your timeline to Financial Independence (FI). See why savings rate is a powerful lever for early retirement.
The Shockingly Simple Math to Early Retirement
In the world of Financial Independence, your Savings Rate is king. It's more important than your income and more powerful than your investment returns. Why? Because it's the only number that attacks the problem from both sides.
Every dollar you save brings you closer to your goal, but it also represents a dollar you've learned to live without. By increasing your savings rate, you simultaneously build your nest egg faster AND reduce the size of the nest egg you'll ultimately need. This calculator shows you the powerful relationship between your savings rate and your time to financial freedom.
How to Use This Calculator
Enter Your Income and Taxes
Input your gross annual income and the total annual taxes you pay to determine your net (after-tax) income.
Allocate Your Net Income
Use the slider to allocate your net income between annual expenses and annual savings.
See Your Results
The calculator will display your savings rate as a percentage of your net income and estimate the number of years it will take you to reach Financial Independence based on that rate.
Interpretation & Strategy
The chart shows the predictable relationship between savings rate and the time to financial independence. It reveals that your savings rate is the primary driver of your timeline.
The 50% Rule
If you save 50% of your income, you are saving 1 year of living expenses for every 1 year you work. This cuts your working career to ~17 years, regardless of income.
Income vs. Spending
Increasing income helps, but cutting spending counts double: it increases your savings today AND lowers the amount you need to save for the future.
Time is Money
Every 1% increases in savings rate shaves months off your working life. 10% savings takes 51 years to retire; 20% takes 37 years.
Control What You Can
You can't control the market, but you can control your savings rate. It's the most reliable lever for early retirement.
Take Your Plan to the Next Level
This calculator is just one piece of the puzzle. Use our full Financial Independence Simulator to unite your income, investments, and expenses into a single, interactive roadmap.
Ready to Refine Your Plan?
After seeing your savings rate, dig deeper into the specific timelines.
Frequently Asked Questions
Savings Rate is typically calculated as the amount you save divided by your income. There are two common ways to measure it: (Amount Saved / Gross Income) or (Amount Saved / Net Income). This calculator uses your Net (after-tax) Income for a more accurate reflection of your financial effort.
While investment returns are important, you have very little control over them. In contrast, you have significant control over your savings rate by managing your income and expenses. A high savings rate has a dual benefit: you accumulate wealth faster, and you learn to live on less, which reduces the total amount of money you need to retire.
This is an estimation based on the 'shockingly simple math' popularized by Mr. Money Mustache. It assumes a 5% real (after-inflation) investment return and calculates how many years it would take to go from your current portfolio value to a portfolio 25 times your annual expenses. It's a powerful illustration of how your savings rate is the primary driver of your FI timeline.