I've been reading Yahoo Finance a bit recently due to all of the shifts in the market, and they have a PF section where they cycle through a variety of PF topics. One of them linked to a retirement calculator, which I had a lot of trouble with as someone looking to retire way earlier than typical, so I decided to go look at a few more and compare them.
Warning: these are pretty US-centric.
Smart Asset retirement calculator
- maxes out at 40% savings rate
- minimum retirement age is based on birth year (i.e. can't retire before today)
- default annual rate of return is 4%? This is worded oddly, because it's called "savings" and is right under "cash savings and investments"
- no option for HSA, but you can lump it in with IRA
- seems to estimate Social Security income, which is cool
- has on option to add a spouse, which was cool
This was was pretty awful, but with some fiddling, I got it to spit out some halfway decent numbers. It seems to be a simple flat return tool, so no backtesting or randomness at all, but it does try to account for taxes and whatnot. That said, it got my tax rate completely wrong for some reason.
I guess this is acceptable for someone to get a rough idea of what retirement looks like, but it was also really fiddly and buggy (i.e. Social Security age kept resetting to 66 for whatever reason).
My 401k provider (Empower)
- minimum retirement age is 50?!
- automatically pulled in elective deferrals and employer match, but it was way off (surprising because it's literally the custodian for my 401k...)
- can link accounts, but can't add any accounts w/o linking (weird, because my old 401k provider that they bought allowed me to)
- assumes 60/30/10 stock/bond/cash split, with no way to adjust it (I'm going 100% stocks)
- links with a budgeting app they have internally? Why would I use my 401k as a budgeting app??
- option to simulate what automatically increasing retirement contributions does (not useful for me, but could help others)
- option to add kids and estimate college expenses, which was cool
This one was absolutely terrible. Not only was it a pain to figure out how to input my numbers, it also didn't really give useful output. Even if I was a typical retiree, I'd still find it largely useless, unless my 401k was literally my only retirement account (which I admit is probably pretty common).
Fidelity brokerage
- retirement age must be greater than current age (can't retire immediately
- lots of estimates for retirement expenses (i.e. no stupid % of income metric)
- can set asset allocation for retirement accounts (domestic, international, bonds, etc)
- can link accounts, or just enter their values
- can add Social Security, and it'll estimate for you if you want
- seems to do some kind of back-testing because portfolio growth isn't a smooth line
All in all, I found Fidelity to be pretty good! It's easy to add all of the accounts and provide as much detail as I'd like, and I feel like the result is pretty realistic.
FiCalc
Primarily for backtesting withdrawal strategies, and it provides a bunch of tools, such as:
- withdrawal strategy - constant dollar, percent of assets, etc
- constant withdrawals (e.g. putting a kid through school, pay off house, etc)
- extra income - i.e. barista FI or whatever
- adjust range of historical data
It won't tell you when you can expect to retire, but it'll tell you your retirement plan's chance of success, which is way more important IMO.
Fire Calc
Primarily backtesting, but there are some knobs you can mess with as well if you click through the tabs:
- pensions/additional income
- future retirement date (plus how much you'll contribute until then)
- withdrawal strategies
- portfolio makeup
- additional portfolio additions (house sale, inheritance) and subtractions (one-time expenses at a certain point in retirement)
This is the first one I used, so it holds a special place in my heart.
What I personally use
I like mucking about with the above, but at the end of the day, I mostly just use my spreadsheet to estimate things. Some specific calculations I find a lot of value in:
- FI Date -
EDATE(TODAY(), NPER(...)) - progress toward FI -
1-(NPER(with current assets)/NPER(assuming starting from zero)) - Social Security calculator - this one exists, but it assumes zero inflation going forward; so I wrote my own in my spreadsheet that uses average inflation from my working career going forward, and actual inflation numbers going backward; not used in any calculators, but it's nice as a backup plan
- withdrawal simulator - how much I'd need to withdraw from tax-deferred accounts before RMDs, by SS max age, and SS min age (helps w/ tax planning)
But at the end of the day, the first is the only one that matters. I update my total spending about once/year, my investment accounts when I remember, and my savings rate comes from my budget. I periodically check my FI number against back-tested portfolios, but I've settled on a SWR of 3.5% and assume a 7% real market return.
Conclusion
These aren't the only retirement calculators I've played with, but the easier ones to access (i.e. search results or though 401k) tend to be pretty awful, while the good ones are a bit more hidden away.
I think with a bit of searching, you can find some decent tools without having to DIY. Then again, I prefer to DIY.
Do you have any retirement calculators you like? Do you DIY?
Yeah, my guess is that since they have nukes, we feel obligated to keep them close so those nukes don't end up in the wrong hands.