How to Estimate Your Retirement Income Needs

Thinking About Retirement? Start With a Plan
Planning for retirement isn’t just about saving money—it’s about knowing how much you’ll need. At California Community Credit Union, we’re here to help you prepare for your future with confidence. Here’s a step-by-step guide to help you estimate your retirement income needs.

1. Visualize Your Retirement Lifestyle

Will you travel? Stay close to family? Pick up a hobby or even work part-time?
Start by imagining what your day-to-day life will look like in retirement. Your lifestyle choices will directly impact how much income you’ll need.

2. Estimate Your Annual Expenses

Create a realistic list of expenses. Here are some common categories:

• Housing (rent, mortgage, taxes, maintenance) 
• Food and utilities 
• Healthcare and insurance 
• Transportation 
• Leisure and travel 
• Debt payments 
• Emergency fund contributions 

A good rule of thumb: plan for 70–80% of your current annual income during retirement.

3. Don’t Forget About Inflation

Inflation gradually increases the cost of living. Even a modest 2–3% inflation rate can significantly affect your long-term financial plan.
Make sure your retirement income plan is adjusted for inflation so your money doesn’t lose value over time.

4. List Your Guaranteed Income Sources

Some income sources you may be able to count on include:

• Social Security benefits 
• Pension plans 
• Annuities 
• Rental or passive income 

Visit ssa.gov to get a personalized estimate of your future Social Security benefits.

5. Find the Gap

Now subtract your expected annual guaranteed income from your projected annual expenses.
This is the gap you’ll need to fill with your savings and investments.

Example:
Estimated annual expenses: $60,000
Expected Social Security: $25,000
Annual gap: $35,000

6. Multiply by Your Retirement Years

Once you’ve found the gap, multiply it by the number of years you expect to be retired.

Example:
$35,000 x 25 years = $875,000 needed from savings

This gives you a ballpark estimate of how much you should aim to have saved by retirement.

7. Build a Plan That Works for You

The earlier you start, the more time your money has to grow. Consider working with a financial advisor to:

• Create a realistic savings strategy 
• Adjust your plan as life circumstances change 
• Ensure you’re investing in the right mix of assets 

We’re Here to Help

At California Community Credit Union, we’re committed to helping you take the guesswork out of retirement. Whether you’re just starting or nearing retirement age, our team can help you understand your options and build a plan that fits your future.

Contact Us:
📞 Phone: (800) 332-1418
🌐 Website: www.caccu.org
✉️ Email: [email protected]

Final Thoughts

Retirement planning doesn’t have to be stressful. By understanding your needs now, you can take the right steps to create a financially confident future. Reach out to CACCU today—we’re here to support every step of your financial journey.