Retirement Pension Planner
Do you know what it takes to work
towards a secure retirement? Use this calculator to help you create
your retirement plan. View your retirement savings balance and your
withdrawals for each year until the end of your retirement. Social
security is calculated on a sliding scale based on your income.
Including a non-working spouse in your plan increases your social
security benefits up to, but not over, the maximum.
Definitions
- Current age
- Your current age.
- Age of retirement
- Age you wish to retire.
This calculator assumes that the year you retire, you do not make any
contributions to your retirement savings. So if you retire at age 65,
your last contribution happened when you were actually 64. This
calculator also assumes that you make your entire contribution at the
end of each year.
- Household income
- Your total household income. If you are married, this should include your spouse's income.
- Current retirement savings
- Total amount
that you currently have saved toward your retirement. Include all
sources of retirement savings such as 401(k)s, IRAs and Annuities.
- Rate of return before retirement
- This is
the annual rate of return you expect from your investments before
taxes. The actual rate of return is largely dependant on the type of
investments you select. From January 1970 to December 2005, the average
compounded rate of return for the S&P 500, including reinvestment
of dividends, was approximately 11.4% per year. During this period, the
highest 12-month return was 61%, and the lowest was -39%. Savings
accounts at a bank pay as little as 1% or less. It is important to
remember that future rates of return can't be predicted with certainty
and that investments that pay higher rates of return are subject to
higher risk and volatility. The actual rate of return on investments
can vary widely over time, especially for long-term investments. This
includes the potential loss of principal on your investment.
- Rate of return during retirement
- This is
the annual rate of return you expect from your investments during
retirement. It is often lower than the return earned before retirement
due to more conservative investment choices to help insure a steady
flow of income. The actual rate of return is largely dependant on the
type of investments you select. From January 1970 to December 2005, the
average compounded rate of return for the S&P 500, including
reinvestment of dividends, was approximately 11.4% per year. During
this period, the highest 12-month return was 61%, and the lowest was
-39%. Savings accounts at a bank pay as little as 1% or less. It is
important to remember that future rates of return can't be predicted
with certainty and that investments that pay higher rates of return are
subject to higher risk and volatility. The actual rate of return on
investments can vary widely over time, especially for long-term
investments. This includes the potential loss of principal on your
investment.
- Percent of income to contribute
- The percentage of your annual income you will save for your retirement goals.
- Expected salary increase
- Annual percent increase you expect in your household income.
- Years of retirement income
- Total number of years you expect to use your retirement income.
- Percent of income at retirement
- The percent
of your working year's household income you think you will need to have
in retirement. This amount is based on your income earned during the
last year you will work. You can change this amount to be as low as 50%
and as high as 150%.
- Company pension income
- This is the monthly pension benefit you expect to receive when you retire. This amount is not adjusted for inflation.
- Spouse pension income
- This is the monthly pension benefit your spouse expects to receive at retirement. This amount is not adjusted for inflation.
- Expected rate of inflation
- What you expect
for the average long-term inflation rate. A common measure of inflation
in the U.S. is the Consumer Price Index (CPI), which has a long-term
average of 3.1% annually, from 1925 through 2005.
- If you are married checkbox
- Check this box if you are married. Married couples have a higher maximum social security benefit than single wage earners.
- To include Social Security checkbox
- Check this box if you wish to include social security benefits in your retirement planning.
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