Retirement Calculator, Retirement Projections
A retirement calculator can give you the financial data you need to
plan and make retirement projections.
It’s never too early to start building your nest egg and dive headlong into devising a sustainable financial planning strategy. A number of retirement calculators are available for beginner and experienced investors alike, each comprised of varying formulas for delivering financial projections.
Regardless of the results of your financial calculator and retirement projections, some fundamental rules of financial planning apply. The key to a successful retirement strategy is to plan ahead, save as much as you can, and grow your assets by investing.
While retirement calculators can give you a good headstart on
planning for your retirement, it’s important to remember that a
retirement projection is only an estimate and is not set in stone.
As your financial situation changes over the years, it’s a good idea
to revisit your objectives regularly with the help a professional
advisor to adjust your projections as necessary.
Atlantic Financial can provide this type of ongoing advice and service to you.
PLAN. The key to using a retirement calculator for making functional and actionable retirement projections is to plan ahead. There are several retirement calculator resources and tools offered by investment firms and financial publications. Most will help you determine how much annual retirement income you'll need, how much you can count on from your 401(k) distributions, pension and Social Security benefits, and what your total nest egg must be.
While the methodologies used in each financial calculator varies by tool, most take the following factors into consideration:
- Start age: When do you intend to begin drawing income from your retirement assets?
- Retirement length: How long do you estimate your retirement period will last?
- Marital status at retirement
- Retirement assets: How much money do you plan to have at the time you begin drawing your monthly income?
- Monthly income goal: How much pretax income do you wish to withdraw each month? Typically, this does not include income from pensions, social security, or other outside sources.
SAVE. It’s important to be realistic about your potential income sources at retirement. You may find that it’s more beneficial to err on the conservative side, rather than overestimating your income. Based on your monthly income goal at retirement, your retirement projection should help you decide how much you need save to reach your objectives.
Equally important is to factor in the rising cost of health care in your retirement plans. Be prepared to pay for your own health care premiums when you retire.
There are plenty of investment options for those wishing to grow
their nest eggs. For many workers, employer-sponsored 401(k)
retirement plan offer a cost-efficient way to save, while also
securing “free money in the form of employer contributions. Whenever
possible, maximize your contributions to your 401(k) to ensure that
you maximize your employer match.
Diversification is key to a successful investment strategy: don’t put your nest egg in one basket. Financial advisors at Atlantic Financial can work with you to develop a mix of investment options designed to meet your retirement goals. For more information about our services or to have us answer any questions you may have, please contact us.