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There are a lot of retirement calculators out there, most of them not very good. When folks ask me for a retirement calculator recommendation, I try and balance ease of use with flexibility. You want to be able to run the most customized scenarios but without having to read a manual on how to operate the thing.
Enter my two favorite retirement calculators.
Personal Capital Retirement Calculator
I already use Personal Capital to track my net worth and expenses, and it ties all the data I’ve fed it into a free retirement calculator in its ‘Advisor Tools’ section. You don’t need to have uploaded all of your data into their dashboard to use the calculator, but if you do it has clever ties to pull some of the relevant data. You will need to sign up to gain access to the calculator, but the service is free, and we’ll get to all the powerful stuff it does that makes it worth it.
Instead of hitting you with a wall of text, the system walks you through each of the onboarding questions one by one. It takes probably 60 seconds to input the needed information. Then it crunches all the numbers and shows you this awesome report.
You can then drill down and customize any areas you’d like. For example, here are the key assumptions you can change. If you’ve read my article on zero income tax in retirement, you’re going to see a giant boost from taking this down to zero. You can tweak inflation to your heart’s content and get comfortable you’ll succeed in any environment.
Detail, Detail, Detail
For those who want to dig deeper into the report, the system allows you to see the full annual series of cash flows so you can see how your nest egg is changing over time during your retirement.
One-Time or Life Transition Changes
You can also add specific income streams later in your retirement. Maybe you plan to work part-time in retirement. Or you expect to downsize your house in 20 years. No problem, there are options to input these cash infusions.
One of the features I most appreciate is the ability to add one-time spending events. Sure, you may have a rough amount you expect to spend per year, but what about helping your kids with college, support you want to provide to aging parents, or a once in a lifetime big trip for your 50th birthday? This is where most retirement calculators fall flat. Personal Capital has you covered. You can insert these expenses anywhere in the timeline. You can even insert recurring expenses – for example, a supplemental cost for nursing home care after age 80.
I saved the best for last. Personal Capital has section for “How Can I Improve This?”, and it will walk you through customized, concrete ideas for how to better your chances of your nest egg supporting you through retirement. This is why hooking up all your accounts in their dashboard adds extra value. They scan your portfolio allocation and make recommendations specific to you, along with a quantified estimate of how much the strategy could save/make you over time.
Here are a few examples:
The combination of ease of use, recommendations, and assumptions modification are what make this my top pic as the first retirement calculator I think everyone should start their process with.
I want to mention one other retirement calculator which I think is very strong. CFireSim is an open-source calculator which offers similar functionality as Personal Capital’s. It also offers you more granularity on your investment performance beyond conservative, moderate, slightly aggressive, etc. The downside is that it’s not intuitive to use and the results are much more difficult to parse. It also does not include suggested improvements for tax efficiency, capital deployment, and asset allocation which can add up to thousands of dollars of improvement. The two calculators together make for a powerful combination.
Where Can I Find These Calculators?
Check out Personal Capital and sign up for a free account for the best overall retirement calculator to start. I highly recommend hooking up all your accounts so it can personalize its suggestions as well as give you an ongoing dashboard to track your key net worth and expense metrics. If you’re still looking for more, check out CFireSim after tinkering a couple of days with Personal Capital tool and implementing its improvement advice. And nerd out with me about our respective retirement calculations in the comments!
Share your own experiences with these tools! What’s your new target number and retirement date?