As you approach retirement age, hopefully you have been a good saver, consistently putting money away each pay period in a retirement savings account for your future. But you may receive several other kinds of income in retirement that you can use to help fund your lifestyle needs along with those retirement savings accounts. Here’s how to estimate your total income in retirement.

Step 1

First, gather the balances of all your retirement savings accounts in which you have saved a certain dollar amount each pay period or per year – this includes employer-sponsored plans (401(k), 403(b)/Thrift Savings Plan, etc.) and individual accounts such as IRAs and Roth IRAs. Add the total value up and set this figure aside for now.

step 1 - gather balances of all retirement savings accounts for estimate income in retirement

Step 2

Next, access your Social Security benefit statement by creating an account or logging into Here, you can print an estimate of your monthly retirement benefits:

  1. At your “full retirement age,”
  2. If you choose to collect early (at any age between 62 and your “full retirement age”), and
  3. If you elect to wait until age 70 to collect.

Step 2 - A equals Social Security benefits for estimate income in retirement

If you’re not sure when you will begin collecting Social Security benefits, use the “full retirement age” as a guideline (approx. age 66 or 67 for most workers retiring in the near future). Let’s call this figure “A.”

Step 3

After that, gather together any employer pension benefit statements that you may be entitled to, including company pensions, IPERS or other teachers’ pension benefit, railroad benefits, union pension, and any other pension benefits you have earned. Look for the monthly amount on your annual statement, or contact your employee benefits officer to determine the monthly benefit you can expect to receive when you retire. We’ll mark this item “B.”

Step 3 -B equals employer pension benefits for estimate income in retirement

Step 4

Finally, estimate any other monthly income sources that you may receive in retirement. This includes cash rent if you have farmland or rental real estate assets in your portfolio, part-time job earnings if you plan to pick up a “side gig” or “hobby job” in retirement, and any other dollars coming in each month. We’ll label this type of income “C.”

step 4 - C equals other monthly income sources for estimate income in retirement

Step 5

We’re almost there! Let’s add up A (Social Security), B (Pension), and C (other income) to get the total we’ll call “D.” (A + B + C = D). Now compare “D” to your current monthly living expenses which we will call “E.” This should include fixed/set items like home mortgage or rent, health insurance premiums, homeowners’ insurance, auto insurance, property taxes, utilities, cable/internet/cell phone service, prescription drug costs, and other fixed costs. “E” also includes items that vary in amount from month to month like medical visit costs/copays, groceries, gas, dining out, entertainment, travel, gifts, and charitable giving.

Step 5 - Add them up. A (social security) plus B (pension) plus C (other income) equals D for estimate income in retirement

If “D” is greater than “E,” (D > E), congratulations! You won’t need to take significant withdrawals from your retirement savings accounts to maintain your lifestyle in retirement. If “D” is less than “E,” (D < E) that’s okay – the difference (E – D) is simply the amount you’ll need to withdraw from your retirement savings account to bridge the gap. By saving consistently while you are in the working world, you will have more flexibility and freedom to enjoy the retirement you’ve always dreamed of. And, if you haven’t started saving yet, now’s the time! Even small amounts can make a big difference in the long run.

Next steps:

  1. Check out our retirement income estimator calculator for more detail – we even have one that can help you do the math through this process!
  2. Connect with me, or another Bankers Trust Wealth Advisor if you’d like to learn more.
  3. Continue learning about planning for retirement by subscribing to receive new articles in your email inbox.