General
Home
Health
Dependents
Benefits
Savings
Events
Social Security
Retirement Jobs
Assumptions
Target OptionYour inputs will be protected with bank-level security and will not be shared with any third party.
If planning on any employment or business income during retirement, please enter the annual amount you expect to earn.
This section allows you to calculate a monthly personal budget (in today's prices) in order to compare to the personal budget shown under each retirement option. This can help you select the option that works best for you.
Please review our estimates below and enter your actual pay where our estimates are too far off. Enter zero for all years when you didn't pay Social Security taxes (for example, you didn't work or weren't covered by Social Security). If you make edits, you can enter just a few representative years and we'll estimate the rest. Tell me more...
Please enter at least one of the three values below. They can be found on your most recent statement under Your Estimated Benefits > Retirement.
Please enter at least one of the three values below. They can be found on your spouse's most recent statement under Your Estimated Benefits > Retirement.
Manage your paid services and clients.
Please list your pension benefits from all employers, both life annuities and expected future lump sum distributions. Please add any life annuity products you might have purchased on your own as well. Examples...
Your inputs across all sections represent one "plan". You can tweak your inputs under this plan and your options will recalculate in real time. You can also create multiple plans so you can compare your results under different sets of inputs. To create a new plan, simply click "Make a Copy" next to a plan below and MoneyBee will create an identical copy of that plan so you don't have to start from scratch. Examples...
We use intentionally wide ranges for the options we show. Here, you can adjusts these ranges in order to narrow down the options shown. If you are a "commercial use" subscriber, you can adjust these limits separately for each client.
Under this option, you can enjoy $ a month in retirement for personal and optional expenses. This is your disposable cash after taxes and required expenses (home, health, dependents and events).
The $ is in today's prices. MoneyBee automatically increases it with inflation to maintain its purchasing power.
Here's one possible allocation of this budget, where "Normal" is based on
How much should I save for retirement? When can I retire? What standard of life will I have? These are complex questions with so many moving parts - mortgages, home purchases and sales, healthcare, spouses, dependents, taxes, Social Security, employment-related benefits, special events. These interrelated factors are likely to be very different for each person. They also follow complex rules and unique future growth patterns.
Retirement is an important decision that should take into account all important aspects of your individual circumstances and utilize the best available models, research and practices. MoneyBee achieves that by providing detailed, reliable and accurate calculations - done behind a simple and intuitive interface.
Since we all have our own preferences as to when and how to retire, MoneyBee will identify all of your options so you can make an informed decision about what is best for you. All handled via bank-level data security for the safest and most reliable way to plan for retirement.
MoneyBee models rent, mortgages, property taxes, maintenance expenses, rental income, and future home purchases and sales. It even calculates a simplified, but reasonable, allowance for your capital gains tax if you plan to sell your home.
Home-related expenses are a major piece of the puzzle and everyone's circumstances and strategy are unique. That's why any effective retirement calculator must allow you to model them explicitly.
Many of us will retire before paying off our mortgage and want to make sure we can keep up with our mortgage payments after we retire. After our mortgage is paid off, we still need to make a reasonable allowance for periodic home improvements and property taxes, each increased with an appropriate inflation rate.
Some of us plan on selling our home and buying a smaller one, with the net gain added to our retirement savings. Some take a new mortgage after purchasing their retirement home. Others plan on buying a rental property to finance their retirement.
MoneyBee allows you to specify different inflation rates for all items that are likely to grow differently. All inflation rates are pre-filled with reasonable, research-based defaults and clearly explained.
A major flaw of many calculators is not adjusting for inflation or assuming the same inflation rate will apply to all aspects of your life.
However, your salary, property taxes, personal expenses, healthcare costs, and investments will likely all grow at different rates. The result is an unreliable calculation where you risk not being able to afford as much as you thought you would.
MoneyBee matches exactly the Social Security Administration's calculators on "future (inflated) dollars" basis, if using the same pay history.
Another major concern is failing to project your Social Security benefits accurately and realistically.
The main issue is using "current dollar" benefit projections, which assume no future increases in your own earnings, the average wage index, and the taxable maximum. The benefits listed on your Social Security statement are on this basis, and so are the Social Security estimates by most retirement calculators that calculate these benefits from scratch.
Social Security benefit estimates on "current dollars" basis are intended to give us a sense of the purchasing power of our future benefits. However, this is not the right number for retirement planning, where every piece of your financial reality should be increased with its own appropriate and reasonable rate. Using "current dollar" Social Security benefits may be appropriate only if you are just about to retire.
The SSA publishes their own assumptions about how each component affecting your benefits will change over time. These assumptions are based on considerable economic research and can be expected to be reasonable. The SSA uses these assumptions in their online calculators, if you select "future (inflated) dollars". This is the appropriate number for retirement calculators.
MoneyBee allows you to enter your spouse's information separately from yours and makes appropriate adjustments to your taxes, pre-tax withdrawals, required minimum distributions, survivor benefits, etc. Importantly, it also extends the planning horizon to cover the expected lifespan of the last survivor.
Excluding your spouse from your retirement planning can also be a serious issue. Even if your spouse never earned any income, he/she would still be entitled to a Social Security spousal benefit on your account, which can be nearly half of your own and will be payable on top of yours! Your spouse will also be entitled to a survivor benefit under Social Security and under any employer pension.
The issue goes beyond spousal and survivor benefits. What if your spouse is working and saving for retirement as well? What if he/she plans to retire at a different time from you? And what about taxes? Most calculators completely ignore taxes (which is another major problem we discuss below), but if any allowance is made for taxes, obviously having spousal information becomes essential. The list goes on. Healthcare expenses, required minimum distributions and taxation of withdrawals from retirement accounts are all determined individually for each spouse.
Including your spouse in your analysis also helps plan for the correct time horizon. Women on average live five years longer than men. So if a wife is five years younger than her husband, she may outlive him by ten years. Prudent retirement planning should make sure there is enough money for the remaining life of the last survivor.
MoneyBee uses current tax rules to project your U.S. state and federal taxes in each year after retirement. While our tax projections are intentionally simplified, they do take into account all major pieces of the puzzle and should make for a reasonable tax allowance in most cases.
Many retirement calculators simply ignore the fact that our taxes will be very different in retirement than they are now.
Social Security benefits are taxed using different rules from regular income, at both federal and state levels. Most states (including California) don't tax Social Security benefits at all.
State income taxes are an important consideration in choosing where to retire. Many people move out of California after retirement precisely to avoid its high income tax on their investment income and withdrawals from pre-tax accounts. Shouldn't a retirement calculator allow us to compare retiring in California versus retiring in Oregon?
And how can we not consider taxes on withdrawals from our retirement savings? The whole point of rolling over our savings to a Roth IRA is to avoid paying taxes when we draw on that money after retirement. The main advantage of pre-tax savings (like traditional IRAs and 401(k) plans) is the deferred tax on contributions and interest.
And what if we plan to sell our home at retirement? How can we not reflect our capital gain tax (or the $500,000 deduction if married and the home was our primary residence)? And how about required minimum distribution rules? These rules may require us to withdraw (and pay tax on) more money than we need. That can have a significant negative impact on our retirement planning.
MoneyBee automatically projects your healthcare costs in retirement. It uses current averages for your age and retirement location, increased with our actuaries' healthcare inflation model. You may adjust as needed. MoneyBee also estimates your health premium tax credit, which can make all the difference if you retire before age 65.
Healthcare is a major expense for most retirees. Still, most retirement calculators do not model these expenses separately.
Aside from emergencies, most healthcare expenses can actually be projected with reasonable accuracy on a long-term basis. After you retire, your healthcare expenses fall in three broad categories: health insurance before age 65 (if you retire before 65), Medicare Supplement insurance after age 65 and out-of-pocket expenses (both before and after age 65).
There is abundant data and research available to help develop a reasonable predictive model for each of these three pieces of the puzzle. The US Bureau of Labor Statistics publishes annual data on health insurance costs for those over 65 and out-of-pocket health expenses for each age group. It also tracks the medical care price inflation since 1947. The healthcare marketplaces provide annual data on benchmark premiums by age and ZIP Code, which can be a good proxy for your health insurance costs before age 65.
MoneyBee allows you to model the expenses of each of your children separately, including how long you expect to support them. It even estimates their healthcare costs automatically.
Most of us retire well after our kids are out of school. However, trends are shifting. Many of us have children later in life and can afford to retire relatively early.
Keep in mind that we define "retirement" here as financial freedom - the ability to support ourselves without employment income. For those of us curious to know what it would take to reach financial freedom while we are still supporting our kids, a retirement calculator simply cannot ignore our child-related expenses, or their timing.
Special events are one-off expenses or income such as your kids' college and weddings, inheritance, a new car every few years, extensive travel around the world, etc. MoneyBee allows you to specify an unlimited number of special events, each with its own inflation, start and end dates.
Another important factor often neglected when planning for retirement is large one-off special events. If these events are paid directly from your savings, a retirement calculator needs to factor them in.
This is particularly important if these events happen after you retire, because you will not have the option to pay for them from your employment income.
However, modeling pre-retirement special events can be just as helpful. Some people have "general savings", which they use for whatever comes along and then use what's left for retirement. If your calculator can handle special events, you can add these savings, specify what major expenses you plan to pay from them, and it will automatically figure out how much of that money will be left for retirement!
MoneyBee doesn't ask you to guess what your total retirement income should be. Instead, it automatically calculates your monthly disposable cash in retirement after taxes and all required expenses. It also show you how your disposable cash will differ depending on what percent of pay you save for retirement and when you retire.
Most calculators either suggest your required total retirement income (based solely on how much you make now) or ask you to enter a constant amount yourself. But after everything we said above, how can you possibly guess this and is it really constant over your years in retirement?
Your required retirement income will likely change over time as your circumstances change (your kids finish college, your mortgage gets paid off, Medicare kicks in, your tax situation changes, different inflation rates apply to different aspects of your life, etc.).
National studies, telling you how much you will need, are of little help too. These studies are only intended for large groups, for example when creating a retirement plan for large corporations or an entire country. They are not meant for individuals because everyone's situation is so unique.
A better question is how much free monthly cash you will need in retirement (in today's prices, after taxes, home-related expenses, healthcare, child-related expenses, and special events) - your disposable cash for personal and optional expenses each month.
* No retirement planning tool can exactly predict the future. MoneyBee allows you to update your retirement plan periodically to obtain up-to-date calculations you can rely on.
It's 100% free & safe.
We know there are so many pieces to the puzzle. It's overwhelming.
That's why we have developed a simple, easy to follow process to guide you through. First, we help you understand what data you need and where to get it. Then we piece it all together and run it through our powerful calculation engine to identify all possible paths to successful retirement. And when you choose a path, we help you manage the ups and downs of life using the same time-tested approach we use in helping pension plans and insurance companies manage uncertainty.
Retirement planning is about finding your perfect balance between: how much you save each year, when you can retire, and what quality of life you can enjoy in retirement.
MoneyBee calculates all possible combinations of these three basic components. We do that by carefully projecting all your benefits and required expenses. Inputs are based on current information - intuitive and well explained.
Our calculations are intentionally simplified and are based on assumptions about many uncertain future events. In doing so, we err on the side of conservatism. We encourage you to do the same when building your MoneyBee model.
As your circumstances change, you can continue to re-calibrate your MoneyBee model and make timely and gradual adjustments to your savings rate, planned retirement age or desired lifestyle in retirement. It's a long and winding road, and we're in this together.
Financial advisers are always welcome at MoneyBee. We value your expertise and appreciate your knowledge and experience, and our community does, too. We offer additional (paid) services to financial advisers to enhance your client work.
We take the security of your data very seriously. All your data is subject to a strong 256-bit encryption in transit. We use Amazon Cloud (AWS) to host our databases, which are also strongly encrypted at rest. Our servers are protected by a firewall monitored 24/7 by a top data security firm.
This case study illustrates what information you will need to enter and what your results will look like at the end.
John and Jill are a married couple living in California with their two kids. They are currently in their 40s and are both working. They hope they can retire in California, if they can afford it.
John and Jill own their home and have a few years left on their mortgage.
They plan to sell their home at retirement and downsize to a smaller one, with just 20% down. They plan to add their net gain to their retirement savings.
They won't be paying rent in retirement. They'll live full-time in their retirement home.
Here is how they set this up.
Here's the information they entered for their current property.
And here's the information they entered for their future home.
The Health section is fully automated, if you want it to be!
We look up your benchmark health premium in the city where you plan to retire (and we update it automatically each year).
We also let you set your other medical expenses to the national averages from the Bureau of Labor Statistics.
John and Jill left these defaults unchanged.
Most users skip this section because they don't expect to be supporting kids after retirement.
John and Jill set it up to be on the safe side.
On this slide, they entered the cost of having their kids live with them until they go to college.
They handled saving and paying for their kids' college in the "Events" section (coming up).
John has a pension with a prior employer. Based on his benefit statement, his pension will be $200 a month if he starts at age 65 and $280 if he starts at age 70.
Jill has a cash balance plan with her current employer, which allows her to take her entire benefit as a lump sum. She also gets benefit statements, but they reflect only service to date, while she plans to work there until retirement.
She went to her employer's online pension estimator and got her projected pension if she works until 55 and 65, respectively. She entered these numbers here.
John and Jill have also been able to set aside some retirement savings on their own.
They included their "cash savings", from which they plan to pay for their kids' college.
Note: If you plan to draw prior to retirement on any savings included here, you also need to tell us in the "Events" section when and how much you will draw. Otherwise, MoneyBee will think that all this money will be available to you when you retire!
Jim and Jill plan to save a constant $1,000 a month towards their kids' college, from now until August 2030 (when their last child starts his last year in college). This is on top of their retirement savings.
They want to pay $15,000 per year per child during each child's college years, in current prices. They expect this amount to increase with 2% inflation to the actual payment year.
They also assume that they will pay the entire $15,000 (increased with inflation) at the beginning of each school year. Their first child is expected to start her freshman year in 2022 and her senior year in 2025. Their second child is expected to start his freshman year in 2027 and his senior year in 2030.
John and Jill let MoneyBee estimate their Social Security earnings history from their current pay.
When they get their next Social Security statements, they plan to enter their complete earnings history to get a more accurate calculation.
They want to start their Social Security payments at age 70, because they can afford to wait that long.
Not all of us can.
It was tempting to think they can continue working part-time or have a side business after they retire. However, they decided to be conservative and not count on any such income.
MoneyBee offers a default value for each assumption.
While these defaults are reasonable in general, they may or may not be appropriate for your own situation.
John and Jill did a little bit of research, especially about their assumed investment return.
Once they answered all the questions, MoneyBee calculated all possible combinations of:
1) what percent of pay they save each year,
2) at what age they can retire and
3) how much personal money they can enjoy in retirement.
To make it easier to browse your options, MoneyBee allows you to prioritize these three components.
John and Jill opted for saving 6% of pay, retiring when John is 65 and enjoying a monthly personal budget in retirement of $3,900 (in today's prices).
They made this their "target option".
To help you better understand each option, MoneyBee provides a detailed breakdown of what exactly you need to do this year and how the math will play out year-by-year for the rest of your life, if assumptions hold.
A hypothetical example of what your "personal budget" can afford is also provided.
MoneyBee also allows you set up multiple "plans".
In addition to the plan they just created, which they called "Retire in California", they created a backup plan - "Retire in Oregon".
All they had to do is click the "Make a Copy" button.
This creates an identical copy of all your inputs so you don't have to start from scratch.
Then in the new plan, they changed the current value of their retirement home from $600,000 to $125,000 in the "Home" section and changed their retirement state to Oregon in the "General" section.
As one can imagine, their results changed dramatically!
Based on their results, they decided they will save 6% of pay and plan to retire in California on 1/1/2037 when John is 65.
If they decide working to 65 is too long, they can retire in Oregon two years earlier when John is 63.
We want to hear your thoughts! Write a review and help us built a better app for everyone.
