Interactive retirement calculators are growing in popularity as they become increasingly sophisticated and easy to access. These online-based calculators, often available on DC companies’ home pages, are embracing a broader view of income sources and potential expenses to help participants plan their retirement on a monthly basis, according to Pensions & Investments. The new calculators account for outside investments, DB plans, IRAs, Social Security and health care costs.
Factoring in health care has been a widespread addition to retirement calculators. Putnam’s Edmund Murphy III says, “It’s not about accumulation, it’s about spending. You can’t do comprehensive retirement planning without taking into account the cost of health care in retirement.”
Companies such as Putnam, Fidelity, Principal and Prudential have all come out with retirement calculators and have made changes and upgrades to them as the environment has continued to shift. Principal’s retirement calculator, for instance, accounts for 85% income replacement that can be adjusted, and it sets a monthly goal and alerts participants if they aren’t reaching their goal.
