1. What is AFN Retirement?

AFN (Additional Funds Needed) for Retirement is the difference between your required nest egg and your current savings. It helps you understand how much more you need to save to meet your retirement goals.

2. How Does the Calculator Work?

The calculator uses the simple formula:

Where:

• Required Nest Egg — The total amount you need for retirement
• Current Savings — The amount you've already saved for retirement

Explanation: This calculation shows the gap between your retirement goals and your current financial position.

3. Importance of Retirement Planning

Details: Calculating your AFN helps you plan your savings strategy, understand how much you need to save regularly, and make informed decisions about retirement age and lifestyle.

4. Using the Calculator

Tips: Enter your required nest egg and current savings in USD. Both values must be positive numbers. The calculator will show your additional funding needs.

5. Frequently Asked Questions (FAQ)

Q1: How do I determine my required nest egg?
A: Consider your desired annual retirement income, expected retirement duration, inflation, and investment returns. A financial advisor can help with this calculation.

Q2: Should I include Social Security in current savings?
A: No, current savings should only include your personal retirement accounts and investments. Social Security is separate income.

Q3: How often should I recalculate my AFN?
A: At least annually, or whenever your financial situation changes significantly (raise, inheritance, market changes).

Q4: What if my AFN is negative?
A: A negative AFN means your current savings exceed your required nest egg. Consider whether your nest egg estimate is realistic.

Q5: Does this account for inflation?
A: No, your required nest egg should already account for inflation. This is a simple gap analysis calculator.