Your "Retirement Number": How Much Do You Need to Save for a Worry-Free Retirement?

Most people think of retirement as an age milestone: "I'll retire at 60." But the more financially sound way to think about it is: retirement is a number, not an age. You can retire when your assets are large enough to generate income to support you for the rest of your life—whether that comes at 55, 60, or 50. This article helps you calculate your own number.

Step 1: Estimate Your Annual Retirement Spending

The starting point isn't income, but spending. Imagine the retirement life you want and estimate your annual costs. Note that some expenses will decrease (raising children, mortgage payments, work-related costs), but others may increase (healthcare, medical care).

For example: you estimate needing 20 million VND/month to live comfortably in retirement → 240 million VND/year.

Step 2: Apply the "Rule of 25"

This is a common estimation rule in retirement planning:

> Retirement Number ≈ Annual Spending × 25

The number 25 comes from the assumption that you'll withdraw about 4% of your assets each year to live on (we'll discuss this in detail in a future post about withdrawal strategies). If you only withdraw 4% annually, the remaining investment portfolio still has the opportunity to generate enough returns to sustain itself over many decades.

Using the example above:

> 240 million × 25 = 6 billion VND

This is the asset size that, in theory, allows you to withdraw 240 million/year sustainably.

Examples by Three Living Standards

The numbers sound large, but don't panic—you don't need to save it all yourself. Subtract the portion that other sources contribute.

Step 3: Subtract Other Retirement Income Sources

The number from Step 2 is your total need. You don't have to "self-fund" everything, because you'll have supporting sources:

• Social insurance pension: a monthly income stream for life—convert this to reduce the burden on the self-funded portion.
• Other passive income: real estate rental, dividends, interest income.
• Existing assets: current savings and investments.

What remains after subtracting is the gap you need to fill through long-term investing from now until retirement.

Step 4: Calculate Required Monthly Savings

Once you know your destination and years remaining, work backward to calculate your monthly contribution. This is when time and compound interest become your allies: the earlier you start, the lighter the monthly contribution needed to reach the same goal.

Illustrative example (assuming 8% annual return): to reach ~3 billion VND in self-funded assets over 30 years, you need to contribute a few million VND/month; but with only 15 years left, the amount must be many times higher. This is precisely why the previous article emphasized "start early."

A Few Notes to Make Your Number More Realistic

• Account for inflation: 20 million/month today won't buy the same amount in 30 years. Think in terms of purchasing power, and prioritize investment channels that can outpace inflation long-term.
• The 25x rule is an estimate, not gospel: it's a good starting point, but everyone's circumstances differ (health, longevity, needs). Review your number every few years.
• Don't let the large number paralyze you: break it into monthly goals, and that 6 billion suddenly becomes a doable-task each payday.

Want to calculate your retirement number and monthly savings based on your situation? Use [Sirifin's savings goal calculator](/vi/calculators/savings-goal), or ask the [AI advisor](/vi/ai-advisor) to build a detailed plan.

This content is for informational and financial education purposes, not investment advice.