{"id":18478,"date":"2025-12-08T01:24:00","date_gmt":"2025-12-08T07:24:00","guid":{"rendered":"https:\/\/www.discover.com\/online-banking\/banking-topics\/?p=18478"},"modified":"2026-02-03T17:44:49","modified_gmt":"2026-02-03T23:44:49","slug":"good-monthly-retirement-income","status":"publish","type":"post","link":"https:\/\/www.discover.com\/online-banking\/banking-topics\/good-monthly-retirement-income\/","title":{"rendered":"What is a good monthly retirement income?"},"content":{"rendered":"\n

Predicting the future is impossible, yet it\u2019s almost a requirement when planning for retirement. If you don\u2019t save enough money while you\u2019re working, you risk struggling financially once you retire. That\u2019s why it\u2019s essential to estimate how much money you\u2019ll need for the kind of retirement you hope to enjoy.<\/p>\n\n\n\n

When should you start saving for retirement?<\/h2>\n\n\n\n

If possible, start saving for retirement right now. Prioritize covering your day-to-day expenses and debts but make saving for retirement<\/a> a very close second. If your employer offers a 401(k), that\u2019s a great way to begin, as is opening an Individual Retirement Account (IRA).<\/p>\n\n\n\n

The sooner you can start, the better. Why is this so important? Someone who begins saving smaller amounts when they\u2019re young is often better off than someone who saves larger amounts later. That\u2019s because of the power of compound growth.<\/p>\n\n\n\n

And it\u2019s never too early to start thinking about the kind of retirement you want. That way, you can begin planning for how much income you\u2019ll need to fund that lifestyle.<\/p>\n\n\n\n

How much money do you need to retire?<\/h2>\n\n\n\n

Retirement planning isn\u2019t a one-size-fits-all process. Your financial needs will be determined by your expected lifestyle. Do you hope to stay in your current home or move into a retirement community? Is traveling a big part of your post-retirement picture, or do you plan on picking up a part-time job?<\/p>\n\n\n\n

Your preferences will likely change throughout your life and impact your financial plans. And that\u2019s okay. It\u2019s still a good idea to estimate how much<\/a> money you\u2019ll need for your ideal retirement as you envision it currently. Any money you save toward that retirement scenario will remain even if your goals change.<\/p>\n\n\n\n

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\u201cA common guideline is to replace 80% of your pre-retirement income,\u201d suggests Jose V. Sanchez, CFP\u00ae<\/sup> and financial advisor. \u201cTake this amount and multiply it by 25 for a ballpark figure of how much you need to save.\u201d <\/p>\n\n\n\n

Why do you need to multiply by 25? Sanchez explains that a common retirement rule of thumb suggests you withdraw only 4% of your savings each year after you retire. Multiplying by 25 gives you the approximate total amount you\u2019ll need to save if you follow the 4% rule.<\/p>\n\n\n\n

Of course, you may not need to save this entire amount if you have other sources of income in retirement, such as Social Security, a pension, or a part-time post-retirement job.<\/p>\n\n\n\n

How to estimate the retirement income you\u2019ll need<\/h3>\n\n\n\n

As you identify your post-retirement income needs, remember that your spending may shift over time.<\/p>\n\n\n\n

\u201cIn the early years, you may be going more places like pickleball, project work, volunteering, travel, and transporting grandkids. Your transportation costs will increase at this stage,\u201d Sanchez explains.<\/p>\n\n\n\n

\u201cAs we enter the next phase, you may slow down,\u201d he adds. \u201cTransportation costs may decrease, yet healthcare costs can increase.\u201d<\/p>\n\n\n\n

What is a good monthly retirement income for a couple?<\/h3>\n\n\n\n

Sanchez suggests having discussions with your partner about your mutual retirement needs. He says it\u2019s worth considering together how your income needs will change after retirement, and whether one partner may want to retire early as long as they can continue using the other\u2019s health insurance benefits.<\/p>\n\n\n\n

It\u2019s also important to talk more generally about what each of you imagines as your \u201cideal\u201d retirement. If one of you wants to travel the world and the other wants to sell everything and live in a cabin in the woods, you should try to find a compromise far in advance. A cabin on wheels, perhaps?<\/p>\n\n\n\n<\/div>\n\n\n

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“A common guideline is to replace 80% of your pre-retirement income. Take this amount and multiply it by 25 for a ballpark figure of how much you need to save.”<\/p>\n