When you’re young, retirement can seem light-years away. Tax laws, Roth IRAs, Social Security benefits, investment returns, annuities, Monte Carlo simulations, and estate planning might be the last things on your mind.
But time has a funny way of creeping up on you. If you wait too long to plan ahead, you could someday find yourself staring ahead at retirement with far less than you need in the bank, and not enough time to make up the difference.
Make no mistake about it, the best time to start getting serious about retirement is when you first join the workforce. Fortunately, planning for retirement is easier than ever thanks to the abundance of tools and software solutions on the market.
Keep reading to learn the best retirement planning tools for 2023.
8 Best Retirement Planning Tools
Here are the top 8 retirement planning tools you can utilize today:
- Personal Capital Retirement Planner
- Schwab Retirement Calculator
- Fidelity Retirement Score
- Stash Retirement Calculator
- Betterment Retirement Savings Calculator
- You Need a Budget (YNAB)
1. Personal Capital Retirement Planner
The Personal Capital Retirement Planner is a bit more comprehensive than some of the other retirement planning solutions on the market.
This app can perform a variety of functions — like analyzing spending and savings. It can also help budget for a variety of different scenarios — like taxes, savings increases, and Social Security distributions.
The app is also easy to use and available for any Android or Apple device.
It’s worth noting that you can’t invest through Personal Capital. This service is just for tracking and monitoring investment and savings accounts.
Empower (formerly Personal Capital)
With Empower, you can see your net worth, analyze investments, and discover any hidden fees you weren’t aware of before – as well as set spending and saving goals.
2. Schwab Retirement Calculator
Schwab is known for its powerful financial planning tools. One of the best services they offer is a retirement calculator that helps you determine what you need to have stashed away to enjoy a good life.
The way it works is simple. Head over to Schwab’s calculator and go through the steps. Tell Schwab about yourself by providing basic information like your age, when you plan to retire, and your investment style (i.e., high, medium, or low risk).
Then, proceed to the next screen and explain your retirement plans — like household income, how much you have saved for retirement so far, and when you plan to retire, to name just a few examples.
In the end, Schwab provides you with a retirement analysis that explains whether you’re on track to reach your target goal.
If you need a broker, consider signing up for Schwab’s retirement accounts. Schwab is one of the most well-known and trusted brokers on the market.
3. Fidelity Retirement Score
If you’re looking for more of an interactive experience and visual aid, Fidelity’s Retirement Score planner is an excellent software package to consider.
The process is very similar to Schwab, as it requires you to enter basic information like your age and annual income. But the end result is a sliding scale that you can adjust to visualize your chances of retiring at a certain age and make a good guess at your net worth.
For example, suppose you’re 35 and making $100,000 per year with $60,000 tucked away in savings.
According to Fidelity’s chart, you’ll have an 84% chance of retiring at age 65 — as long as you put $1,500 per month away into a retirement account. However, if you drop down to $500 per month, you’ll only have a 49% chance of retiring at age 65.
Play around with the chart and enter different variables to see what you need to do to adjust your retirement planning.
Like Schwab, Fidelity is an excellent choice if you need a broker. You may want to sign up for their services after getting a sense of how easy they make it.
4. Stash Retirement Calculator
Stash offers a similar retirement calculator that’s easy to use. Simply plug in some basic information, and Stash tells you how much you need to save.
If you want additional support, you can open an account through Stash and make investments through their platform.
5. Betterment Retirement Savings Calculator
Betterment is another leading financial advisor and investment provider offering a great retirement calculator.
As with most other retirement calculators, enter your basic information and check out Betterment’s analysis. Then, think about starting a retirement plan through Betterment if you like the experience.
MaxFi is yet another program offering a robust retirement analysis program.
This solution has been around for over twenty years, making it one of the more well-known providers in the space. The software is easy to use and can be deployed on any device.
For a great retirement planning solution, you can’t go wrong with Quicken.
This is a great platform that can bring all your retirement accounts to one centralized location. As an added bonus, Quicken can connect to more than 14,000 financial institutions too.
8. You Need a Budget (YNAB)
Retirement planning apps are great for determining how much you should be putting aside into tax-friendly accounts every month. However, they aren’t great for actually making you do it.
If you’re having trouble sticking to a budget, try You Need a Budget. This app can help get your finances on track and break down your cash flow and expenses.
By using YNAB, you can have an easier time making all your payments. Over time, budgeting can free up more capital for savings and retirement.
Tips for Picking a Retirement Planning Tools & Software
With so many retirement planning solutions on the market, it can be difficult to select the right one.
Here are some tips for choosing the right platform.
Watch Out For Fees
Watch out for services that charge ongoing management fees. Small fees can add up to large amounts over time, even if they seem tiny at first. It’s typically better to use free apps and services so that you can pump more money back into your retirement accounts.
Security is Key
If you sign up for retirement software, make sure that you opt for a well-established company with a great reputation.
It’s critical to read reviews and know who you’re doing business with in advance. The last thing you want to do is download an unknown app and start plugging away personal data or connecting it to your personal accounts.
This is an easy way to lose money — or possibly even have your identity stolen. Whatever you choose, the company should demonstrate a clear commitment to data security through encryption and multifactor security, to name just a few examples.
Make Sure the App Offers Support
When it comes to any software solution, you’ll eventually have a question that will require support. And when this happens, you’ll need access to a live agent. Check and see what types of support options are available before using a platform.
Often, companies restrict support, making it difficult to resolve issues. If customer service isn’t a top priority, move onto another provider.
Frequently Asked Questions
Here are the most frequently asked questions about the best retirement planning tools.
What is retirement income?
As the phrase suggests, retirement income is money that you collect in retirement to pay for things like groceries and housing expenses. The main difference between retirement income and regular income is that retirement income doesn’t come from a full-time job. It comes from other sources — like savings accounts, retirement accounts, pensions, and Social Security distributions.
Unfortunately, some people reach retirement age without anything put away in the bank — and this is very dangerous. As such, it’s critical to plan ahead for retirement. That way, you won’t get stuck in a situation where you have to keep working in your golden years.
Do I need a financial planner?
There’s nothing wrong with using a financial planner if you really need one. And in fact, it can be better to use a financial planner than to try to manage finances on your own and make mistakes.
That said, there are many free tools available online for financial planning. So, if you need financial support, consider looking at free financial apps and services. It bears repeating: You may even want to consider using a robo-advisor, which automates the process for you.
Is life insurance a good idea?
Yes, life insurance is a great idea. If you have a family, it’s critical to get life insurance to support them in the event of your untimely departure.
What’s more, there are some great plans available that can enable you to maximize tax-friendly growth for possible living retirement benefits. Talk to a tax advisor or life insurance agent to learn more about this strategy.
The Bottom Line
Let’s face it: Not everyone is great at managing finances. That said, you don’t have to go it on your own. Support is available. Consider using personal finance tools and software to help you in your personal finance journey toward retirement.
Many platforms on the market are user-friendly and easy to learn. They can play a big part in helping you plan your own retirement and financial future. Never forget that all retirees started where you are today.
No matter how bleak you may think your situation is right now, it’s possible to reach your retirement goals through careful asset allocation and a sound financial plan.