Our Free Retirement Calculator Spreadsheet
Download Our Free Retirement Calculator Worksheet in Excel or OpenOffice
There are too many moving parts in a retirement plan to account for in a simple retirement calculator, so we created a simple, yet multi-faceted retirement model that you can use to predict how much money you'll need to save in order to retire. The model is available in three formats and can be downloaded here:
- Excel 97/2000/XP Retirement Calculator Worksheet
- Excel 2003 Retirement Calculator Worksheet
- OpenOffice Retirement Calculator Spreadsheet (if you don't have Excel you can download OpenOffice completely free at openoffice.org)
Now that you have a copy of our free retirement plan, let's go over the instructions on how to use it. It's pretty easy, just update the yellow cells with your estimates for the following:
Annual income during retirement. This is pretty straightforward. Enter the amount of money you will need to withdraw each year from your retirement assets. Do not include any social security, pension or other income in this figure.
Life Expectancy. This is the number of years you have remaining during retirement. If you want to retire at 50 and plan to live to 100, you should enter 50. It is best if you have enough saved to live to 100, as you don't want to run out of money during retirement. If you want to be more accurate, you can look up average life expectancy information from the government.
Investment Rate. This is the rate of return that your overall retirement investment portfolio is expected to return during retirement. If you plan to invest in money markets and CDs, you should enter 1-2%, if you plant to stay mostly in stock, you can enter 8-10%. For a fairly conservative balanced portfolio you may want to enter 5-7%.
Inflation. The average inflation rate over the years has been around 2-4%, but inflation tends to go in cycles. And based on the high deficit and debt in the U.S., inflation is expected to grow slightly in the future. Also, the inflation rate you enter into the retirement planning calculator should be the inflation rate for the items you spend your money on. For example, if health care is expected to be a large part of your retirement spending, then you may want to use a higher inflation rate than the national average.
Now that you've entered in all of the information to the retirement calculator spreadsheet, you should have your first retirement quote of how much money you'll need to retire. Copy your retirement quote to another location. Then use the retirement planning calculator to find two more estimates. One conservative, and one aggressive. Make a conservative estimate where you increase your income needed, life expectancy and inflation and lower your investment rate. Then make a slightly more aggressive retirement plan than your original. Now you have a range of retirement goals that you can use to guage how much safety cushion you should add to your retirement goal estimate.
See Also: Retirement Advice