Retirement Calculators

There are lots of calculator available on the internet. Simply search “retirement calculator”, and you will be inundated. Retirement Calculators come in various formats. But ultimately, they all aim to answer these common questions on retirement:

  • How much will your retirement lifestyle cost?
  • How much Retirement Assets do you need to accumulate?
  • Do you have a shortfall or surplus for Retirement?
  • Will you outlive my Retirement Assets?

 

Since our clients have asked us for tips in this space, we feature some useful or interesting calculators we have tried:

1) How much will your retirement lifestyle cost?

Most calculators will need this as an input. Don’t know how much your retirement lifestyle will cost? This calculator guides you through a series of questions to tabulate your Retirement Income Needs, based on your desired retirement lifestyle.

Figure out how much your retirement will cost with this tool developed by Aviva.

Note: The underlying model of this calculator is based on data from Singstat’s Household Expenditure Survey 2007/2008. The inflation used is 2.72% p.a., based on the compound average annual rate of inflation for 2003-2013, from MAS’ Goods & Services Inflation Calculator.

 

2) How much Retirement Assets do you need to accumulate?

Now that you know how much you need, use this tool from Income to determine how much Retirement Assets do you need to aim for.

This tool allows you to tweak the inflation rate and rate of return which apply to you. It also suggests a monthly amount to start saving.

 

3) Do you have a shortfall or surplus for Retirement?

This tool from Standard Chartered Bank takes in your current savings, as well as on-going savings, and tabulates if you can comfortably meet your Retirement Target.

 

4) Will I outlive my Retirement Assets?

This tool from Vanguard runs a simulation if your Retirement Assets will outlast you. In other words, you can also calculate a safe Drawdown rate for your retirement.

You will need to have an idea of:

  • How many years will you be in retirement?
  • The Value of your Retirement Assets (Note: this is for the field “What is your savings balance today?”
  • Your annual spending
  • How do you plan to allocate your Retirement Assets across Stocks, Bonds and Cash

 

5) Retirement Calculator by CPF – a rather comprehensive tool

Of course, there is the tool available on the CPF website. If you log in via your singpass, it will populate your CPF balances into the calculation. It is pretty comprehensive, and is able to draw upon data around your expenses, anticipated salary increment, on-going savings and investments.

 

Correspondingly, it is therefore the most tedious calculator to use amongst the calculators listed on this page.

Many of these online calculators are easy to use and are a great starting point to Retirement Planning. While taking advantage of them, find out and consider the underlying assumptions. After all, the assumptions will determine the results. And you should consider if the assumptions are close to your realities.

  • Inflation Rate: Has been 2% over past 20 years. Though medical inflation is much higher at 10%.
  • Your individual rate of returns: What is your rate of return on your savings and investment pre-retirement and post-retirement?
  • Increasing longevity: Average lifespan is now 83 years old, and is set to go up. Assuming no chance to your target retirement age, increasing longevity will mean a longer in retirement, i.e.: a longer period of not working for an income

Well, some of us dread the idea of having to run numbers. So, if you rather have the calculations done for you, simply contact us. We will work with you to:

  • Determine your current rate of return and show you how does this drive your accumulation towards Retirement
  • Determine your monthly income needs after you retire
  • Determine if you are on track towards your target Retirement Age
  • Develop a plan for adequate cash flows during your Retirement

 

By |2018-07-05T18:09:39+00:00November 18th, 2017|Retirement|

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