How to Calculate My Retirement Needs

How to Calculate Retirement Needs
Retire On Track LLC.

If you are planning for retirement, your head is probably spinning with questions like these:

How do I calculate retirement needs?

Will my money last throughout my retirement?  

How much money can I withdraw from my portfolio each year (retirement withdrawal rate)?

How should my money be allocated?

How will inflation impact my purchasing power?

How will management fees affect my portfolio's performance?

How do I keep up-to-date on the latest news impacting my retirement?

Fortunately, most of these questions can be answered painlessly through the use of a retirement calculator, like the one found at retirementcalc.com.

How do I calculate retirement needs?

You can quickly calculate the answer to this question by using Bob's Retirement Calculator. Retirement Calculator New Version 3.0 is easy to use and includes all these great features:

How management fee's impact how long your money will last

1973/1974 & 2000/2002 historical economic downturn

30 year projections

Inflation factor enhancements

Interactive retirement asset performance analysis

Colorful graphical interface

Big charts & graphs with new capabilities

Real-time "what if" retirement analysis on the fly

Actual vs. Hypothetical vs. Inflation Proof retirement analytics

Online Web Based

Instant web customer support

Instructions page

Will my money last throughout my retirement?

Retirement can span a third or more of your lifetime.  Making your retirement portfolio last as long as your working life did, can be a challenge.  By plugging a few simple numbers into the retirement calculator you can help answer this question in a snap.

Try Bob's free retirement calculator - The retirement calculator was featured on 'The Saturday Early Show' by CBS' top financial analyst just click the blue button below. Take control and reach your retirement goals.

How much money can I withdraw from my portfolio each year (retirement withdrawal rate)?

This is a crucial question to know the question to. If you withdraw too much, your money will not last your entire retirement.  If on the other hand, you withdrawal too little, then you may end up eating macaroni and cheese for dinner every night for no reason.  It is also important to remember the U.S. government has placed minimum required distribution (MRD) requirements on many retirement instruments such as, 401(k)s, 403(b)s, and traditional IRAs. Entering different withdrawal scenarios into the retirement calculator is easy and its results are revealed instantly.

How should my money be allocated?

Unfortunately, many retirees make the mistake of putting all their money in "safe" investments, such as money market accounts and certificates of deposit.  They take this action, because they mistakenly believe that once they retire, they should not take risk of any kind.  The retirement calculator allows you to input any asset allocation you desire.  You can change the allocation until you find the one that is right for your situation.

How will inflation impact my purchasing power?

Inflation has a withering affect on your purchasing power.  Historically, the inflation rate has been about 3 percent.  Thus, with just the average inflation rate of 3 percent, your costs double every twenty-four years.   You can expect to spend as much time in retirement as you did when you worked.  Therefore, you can expect to see your expenses double during your retirement years.  Again the retirement calculator can show inflation's impact on your portfolio immediately.

How will management fees affect my portfolio's performance?

The latest feature added to the Retirement Calculator Version 3.0 is the impact management fees have on your plan.  Usually, management fees account for roughly a one percent loss of your portfolio each year, though this percentage can be as high as 5 percent or more.  One percent may not sound like an insignificant amount, until you consider that on a $500,000 portfolio, that means you will have to make $5,000 a year just to breakeven.  A five percent management fee on that same a $500,000 portfolio means you will have to make a whopping $25,000 a year to breakeven. 

How do I keep up-to-date on the latest news impacting my retirement?

To keep informed about retirement topics, try a FREE award winning newsletter Financial Hints & Tips at no cost to join, you will receive a monthly newsletter full of financial information to inform and empower you to have a successful retirement. Try Bob's FREE Retirement Calculator.

 

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