Experts have several ways to calculate how much you must save for retirement. You can use the 4% rule, which involves withdrawing 4% of your initial retirement savings annually to cover your expenses for the next 25 years. You can also prepare 80 to 90% of your annual income to cover your retirement expenses. Whichever option is selected, the general rule of thumb in retirement planning is the more expected expenditures in the future, the more savings must be invested in the present.