Best Online Tools (Generally Free) for Retirement Planning
I am a financial planner by personality and by trade, and though I don’t make a living by reviewing the online tools available to help with retirement planning, I’m always interested in seeing what’s out there. For my own clients, I use sophisticated tools that help me model various scenarios with the future retiree, but some of the public, free tools are built on similar technology and are pretty useful.
Some people are do-it-yourselfers, and that’s perfectly fine. For others, the people that become my clients, they’re looking for a little human guidance. If you prefer to go it alone, please check out the following sites and note that I don’t receive any compensation for these recommendations and that sites change over time and something better may come along in the future.
Longevity Calculators
If you want to retire, you’ll need to make an educated guess as to how long you expect to live in retirement. The general rule of thumb for reasonably healthy people in their 50’s and 60’s is to plan to hit at least age 85. If your genes are good and you maintain a healthy lifestyle, plan for longer, like 95.
To do a little more sophisticated guess (this is all guesswork, after all), check out these two calculators:
- Blue Zones True Vitality Test. This is a unique site that tries to match traditional longevity data up with lifestyle choices. I like the idea that it tries to estimate how long you’ll have a “healthy life”, in the sense that you’re active and enjoying retirement. We should all plan for that!
- How Long Will I Live? This has a nice interface and a good report, and I think is a decent option for getting your specific longevity calculated. Beware, however, that it’s paid for by an annuity company and the solution for every retirement income problem for an annuity company is, ta-da, an annuity!
Managing Your Finances
Regardless of when you expect to retire, you could probably use help managing your routine, monthly finances right now.
- Mint. If you’re comfortable hooking up your checking account and credit cards to an online tool, and that’s a big “if” for some people, Mint is the way to go. It’s very pretty and the reports are useful. I find it frustrating that you have to monitor closely the type of expense that’s assigned to some transactions (restaurants that are categorized as clothing retailers, for example), but I don’t suppose there’s an elegant solution for that anywhere online. And one big weakness is for frequent cash users—you won’t know what transactions are classified as when you use cash. Also, there are a lot of advertisements. Mint is always selling.
- Wally. If you don’t want to hook up your accounts, but still want a slick, free tool, I’d try Wally. It’s geared towards the iPhone but has a good layout and does what these budgeting tools are designed to do. Plus, no advertisements!
Retirement Projectors
This category of tool is designed to show if you have enough money saved for an adequate retirement. It’s the crux of retirement planning and the internet provides a variety of options at various quality levels. Most any tool you encounter online that’s free is going to try to sell you something, usually an annuity, but maybe financial planning advice. That doesn’t make these tools bad, just caveat emptor.
- Personal Capital. This site is intuitive to use and has a sophisticated calculator on the back end. It’s nice that you can factor in big expenses (like buying a cabin) or big income events (like receiving an inheritance). Personal Capital is in the business of providing paid advice and managing investments, so you will be contacted if you sign up for this free tool. But, this is a great way to get a fairly detailed retirement plan figured out with an online tool for free.
- Vanguard’s Retirement Nest Egg Calculator. Clients of mine know I’m a huge fan of Vanguard’s mutual funds. This calculator is okay. It’s SUPER easy to use, but sometimes a thing can be too simple. It doesn’t help you with Social Security, with pensions, with expense goals like car replacements, long term care, or medical/Medicare needs. It just figures out if your nest egg will last for your retirement given a certain level of spending and types of assets. Be careful about only using this tool for your retirement, but it could be a good second check.
- Fidelity Retirement Score. I’ve seen a version of this tool offered to many people who have 401(k)s with Fidelity, and this online free tool is decent. You can model your standard of living, different retirement ages, how much you save each month now, etc. I’d say it’s a good choice for those who don’t want the commitment of Personal Capital’s tool.
What tools have you seen that you like or dislike? Drop us a line and we’ll add it to this post.
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