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Insights To Discover The Ideal 401(k) And Retirement Calculator

You are nearing the age to begin serious considerations for your retirement and estate planning. But are there tools available to help you work through some of the numbers? Yes.

There are hundreds, if not thousands, of websites offering a 401(K) calculator or retirement calculators – all promising to show you exactly how much you need to save for your retirement.

However, do they actually work? And why do they all say something different? And with all these choices, which one is actually the best or right for you?

To compare the numerous 401(K) calculators out there, we inserted the same numbers, including savings rate, life expectancy and income into three various online and free calculators.

As an example test subject we used a single, 45-year old male currently earning $50,000 per year with a small mortgage, $90,000 in a 401(K) and a savings rate of about 10% per year.

Our subject had a minimal mortgage balance, a savings rate of about 10% and approximately $90,000 saved in a 401(K). He wanted to retire by the time he was 65, live on $50,000 (100% of his pre-retirement income) and he expected to live until the age of 100.

To find out how each 401(K) calculator on the web rated, along with their recommendations, keep reading.

Calculator: Ballpark Estimate (URL: choosetosave.org/ballpark)

Ballpark recommended that our test subject needed to save just over 55% of his annual income to retire in 20 years with an annual retirement income of $50,000 per year. Changing the retirement age to 70 and even 75 lowered that rate significantly.

The site took about 10 minutes to input our information and produce the results. It was simple to use and lets you add additional or unconventional income sources. Unfortunately, the results can be confusing to read, and if you want to fiddle with your figures, you need to start over from scratch.

The Nationwide’s Retirability Calculator (Online at: nationwide.com/nw/nrri/index.htm?wtgo=retirability)

Nationwide’s Retirability calculator gives users what it calls an “R-Score,” essentially scoring them on their retirement-readiness. A good score is anything above 100. Our poor test subject scored an 88.

In terms of quality and ease of use, the site was fairly fast and provided clear results. It took about 8 minutes to complete the questionnaire and calculate the results. Afterwards, it provided clear and easy to read results. Another bonus factor? It lets you input major assets like home equity.

Calculator: AARP (URL: aarp.org/money/financial_planning/sessionseven/retirement_planning_calculator.html)

The AARP calculator had some grim results, telling us we needed to save over $1600 a month to reach our goal, which is significantly higher than the $416 a month our test subject is currently saving.

In terms of quality and ease, the AARP calculator was fast enough. It took about 10 minutes to complete. Though it wasn’t bursting with features or fancy animations, it definitely produced results that were simple to read and easy to understand.

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