If you're new here, subscribe to my RSS feed to easily see all the latest money management tips, tools and resources. Thanks for visiting!

Online retirement calculators come in all shapes and sizes. Some retirement calculators are extremely simple and provide little in the way of helpful information you can use to plan for retirement. Others are complex affairs that require an advanced degree from MIT to use. What follows are 11 online calculators for retirement that get it just right. They are easy to use, provide a lot of useful information, and best of all, are free.

IRA Calculator

Morningstar’s IRA Calculator is a nifty 3-in-1 calculator if you have or are considering opening an IRA. First, the calculator will tell you whether you qualify for a Roth IRA, a deductible IRA, or a nondeductible IRA. Second, based on how much you plan to save in an IRA, the IRA calculator will tell you how much you’ll have at retirement in each type of IRA. This is a helpful way to assess which IRA is best for you. And third, the calculator will help you determine whether to roll over an IRA into a Roth IRA. So if you have or are considering an IRA, this is definitely a tool to bookmark.

Online Retirement Plans

Boulevard R offers a unique approach to retirement planning. Unlike most retirement calculators, Boulevard R asks how you want to spend your time in retirement, and uses your answers as part of its analysis. It also offers a very easy user interface and very nice charts and graphics to show you where you stand. At the end it calculates what it calls a Retirement Security Index score.

CNNMoney’s Retirement Planner is like creating an online financial plan. The great thing about this tool is that it’s very easy to follow and takes just a couple of minutes to input your data and see the results. The retirement planner accommodates data for both couples and singles, allows you to estimate retirement needs in dollars or as a percentage of current income, and factors in social security benefits (which it estimates based on your income). The results include an estimate of the likelihood your nest egg will grow to meet your needs. In our case, the calculator concluded that we need to earn 9.3% on average to meet our retirement goals, which it assessed at an 82% chance of success.

Fidelity’s MyPlan Retirement Quick Check is a more detailed retirement planner that uses Monte Carlo simulation to estimate how much money you will have during retirement. Monte Carlo is a mathematical model that recognizes that the stock market doesn’t produce the same rate of return each year. One year it could be up 25%, the next it could be down 15%. And this is an extremely important consideration for new retirees. If the market drops 20% in your first year of retirement, the loss can increase the odds you’ll outlive your money. Monte Carlo simulation looks at thousands of possible market returns over a period of time, and produces a range of results with the likelihood you’ll achieve your goals. Fidelity’s Retirement Quick Check is available to Fidelity clients or those that register with Fidelity.

And if you want to understand Monte Carlo retirement calculators better, check out The Retirement Calculator from Hell by William Bernstein.

Retirement Income Calculators

T. Rowe Price’s Retirement Income Calculator also uses a Monte Carlo simulation to estimate the likelihood your retirement savings will be enough. The interesting feature of this calculator is that you choose the confidence level that your money will be enough in retirement. In other words, you can select 99% for example, which means the calculator will assess whether your savings at retirement has a 99% chance of providing sufficient income for you during retirement. One limitation of the calculator is that you must input how much you’ll have at retirement, but the other calculators discussed here can handle that with no problem.

Fidelity’s MyPlan Snapshot is a nifty online tool to help determine how much you need to save to meet your retirement goals. The tool asks your age, income, investment style, monthly contributions to retirement accounts, and retirement savings. Based on this data, it then calculates how much you need at retirement (it assumes 85% of current income) and how much you’ll have if the market performs poorly or as it has in the past. You can then adjust the age at which you’ll retire, your monthly contribution amount, or investment style to see how these decisions may impact your nest egg at retirement.

Other Online Retirement Calculators

There are literally thousands of retirement calculators available online. The calculators described above should cover most DIY retirement planning needs. But here are few more to check out if you’re looking for other options:

• Dinkytown’s Retirement Shortfall calculator
• Bloomberg’s Retirement Plan
• Yahoo’s How Much to Save for Retirement calculator
• AARP’s Retirement Calculator
• Nationwide’s RetirAbility Check

Photo Credit: Wolfgang Staudt

News and Analysis

• Are payday loans actually good for us? An Experimental Analysis of the Demand for Payday Loans (45 page pdf file) written by a team of researchers from George Mason University takes an eye-opening perspective on the subject:

Abstract: The payday loan industry is one of the fastest growing segments of the consumer financial services market in the United States. The purpose of our study is to design an environment similar to the one that payday loan customers face. We then conduct a laboratory experiment to examine what effect, if any, the existence of payday loans has on individuals’ abilities to manage and to survive financial setbacks. Our primary objective is to examine whether access to payday loans improves or worsens the likelihood of financial survival in our experiment. We also test the degree to which people’s use of payday loans affects their ability to survive financially. We find that payday loans help the subjects to absorb expenditure shocks and, therefore, survive financially. However, subjects whose demand for payday loans exceeds a certain threshold level are at a greater risk than a corresponding subject in the treatment in which payday loans do not exist.

• Experian files lawsuit against LifeLock

Experian, one of the big three credit bureaus, sued LifeLock in the U.S. District Court for the Central District of California. LifeLock is a company that promises, for a fee, to guard you against identity theft. One of the things it does to accomplish this is to place a fraud alert on your credit files every 90 days. Experian claims this constitutes false and misleading advertising and fraud, presumably because fraud alerts were intended to protect consumers who believed their identity had been stolen, not to protect against future possible identity theft.

• Selected Major Indexes

This article lists the returns of some of the world’s major indexes.


• HomeSaver Advance

Fannie Mae recently announced a new program to assist at-risk borrowers with refinancing and loan workout assistance. “HomeSaver Advance is designed to help qualified borrowers bring delinquent mortgages current and keep their homes. With HomeSaver Advance, servicers can now offer an unsecured, personal loan that will enable a qualified borrower to cure the payment default on a mortgage loan that Fannie Mae owns or has securitized, with fewer up-front costs and generally in less time.” Loans are for 15 years a 5%, with a 6 month no interest/no payment period. You can download a pdf version of Fannie Mae’s HomeSaver Advance Fact Sheet

Smart Spending

• Little Steps: 100 Great Tips For Saving Money For Those Just Getting Started

A great list of ways to save money from The Simple Dollar.

• 50+ Frugal Tips, Ideas, and Resources

This is a list of lists from Moolanomy! Fifty-two links to articles with ideas on how spend your money wisely. Some of the great ways to save money include:

• 101 frugal Christmas present ideas;
• What is Frugality and Are We Frugal?;
• 30 Frugal Gift Ideas to Show You Appreciate Someone;
• Ultimate Frugality - The Best Free Software For Windows; and
• 75 Frugal Hacks for Your Home.
• 21 Money-Saving Sites from Around the Web

This article from Get Rich Slowly includes links to sites that can help you save money, such as Fat Wallet:



eBooks and Articles

• Census Atlas of the United States

If a picture is worth a thousand words, then the U.S. Census Bureau’s new Census Atlas of the United States speaks volumes about how the nation’s population and housing characteristics have changed over the years. The atlas, with more than 700 full-color maps, is the first general population and housing statistical atlas published by the Census Bureau since 1925.


• The 13 Most Overlooked Tax Deductions

“Years ago, the head of the IRS told Kiplinger’s Personal Finance magazine that he figured millions of taxpayers overpaid their taxes every year by overlooking just one of the money-savers listed [in the article]. Claim them if you deserve them … and cut your tax bill to the bone.”

• Taking the Mystery Out of Retirement

This publication by the U.S. Department of Labor is a step by step plan to retirement. It includes interactive worksheets that cover such topics as current assets and savings, projected asset and savings, and expenses in retirement. You can also download the fully illustrated 62-page Adobe PDF narrative.

• The Economic Mobility Project (1 MB pdf file)
  Download the key findings (200 KB pdf file)

The Economic Mobility report , “authored by a team of scholars at the Brookings Institution, is one in a series of major research products that aims to further enlighten the public dialogue on economic opportunity. While it offers reassuring findings in some areas, in many others there is room for concern. By arming the public and policy makers with facts about the status of opportunity in America today, this volume seeks to stimulate and frame the debate about which policies are likely to be most effective in ensuring that the American Dream endures for the next century.”

• Dave Ramsey’s Baby Steps

The M-Network did a series on Dave Ramsey’s 7 Baby Steps to Financial Freedom.

• The Real Cost of Homeownership

Here are a couple of additional costs that need to be considered when taking the leap from being a renter to being a homeowner.

• Are Traditional Indexes the Best Benchmarks?

This article looks at traditional indexes, including the S&P 500, and considers whether they remain a relevant benchmark against which to compare investment returns.

• The 5 Year Stock Market Rule

Don’t invest in the stock market unless you’re going in for 5 years.

• Will Divorce Sink the Retirement Ship?

Divorce is painful, emotional, financial and otherwise. I now that having lived through two divorces by the time I was 12. This article looks at some of the financial issues that arise during a divorce.

• To Roth or not to Roth 401(k)

“Let’s start with one basic but often misunderstood fact. Although they’re effectively mirror images of each other -with a regular 401(k) you invest pre-tax dollars and pay taxes at withdrawal, while with a Roth 401(k) you invest after-tax dollars and pay no tax at the end -in a pure economic sense there’s really no difference between the two.”

Cool Tools and Resources

• 
  Death and Taxes 2008 Online Poster

Do you want to know how your tax dollars are being spent? This massive online poster tells all.


• Voyant’s @Home financial planning tool

Voyant @Home helps people understand the big-picture impact of life-changing events and their long-term financial implications - from the birth of a child to the early retirement of a spouse.


• Does dollar cost averaging really work? Check out this online dollar cost averaging calculator and find out for yourself.
• The Investor Awareness Index

“The Investor Awareness Index is the only resource that rates the comprehensiveness & effectiveness of a company’s initiatives to generate awareness for its stock within the investment community. The 0-10 rating scale is designed to assist in the investment research process by providing investors with unique insight into a critical element for a successful investment: understanding if a company is doing the right things to generate broad awareness among investors, portfolio managers, and stock analysts.”

• Mortgage Marvel: A tool to help you compare mortgage rates
• Google Sites: “Google Sites is the easiest way to make information accessible to people who need quick, up-to-date access. People can work together on a Site to add file attachments, information from other Google applications (like Google Docs, Google Calendar, YouTube and Picasa), and new free-form content.”
• The Life Cycle of a Blog Post


It’s interactive, so make sure to click through if you want to check it out.

Source: Cool Infographics

• The cost of gasoline:


Source: The Price of Gasoline

• Boulevard R

An online financial planning tool. Here’s a Youtube video describing the tool

• The Finwikian: Your Two Cents on Personal Finance — a new personal finance wiki)

A community has grown up around personal finance blogs. As a librarian-type, I felt compelled to organize it into a useful resource. Obviously, no one site will ever capture the multiplicity of viewpoints and experiences found in the individual sites. However, I hope that this one will be valuable for bloggers and for those looking for information.

For example, each blog page links to tables of blogs—such as Personal Finance Bloggers, Tax Bloggers, or Frugality Bloggers. These tables allow you to discover other blogs with similar interests, to learn a little bit about them by visiting their Finwikian pages and then to visit the blogs themselves if you’re interested.

That makes it an excellent tool for writers and readers, you can share your blog with others, you can contribute to pages on other blogs you read, and hopefully you will discover new blogs in the process.

There will be a number of pages on various topics from Dave Ramsey and his Debt Snowball to Credit Card Arbitrage and Peer To Peer Lending. I can’t create them alone; I hope that the personal finance community will join together in making this not just one person’s site and idea, but our site full of our ideas.

I thought I’d end this Best of with a Lending Club commercial I found on YouTube. This goes back to the days when Lending Club was on Facebook only. Trust me, they’ve come a long way. . .

Dodge & Cox announced last week that it will open its Dodge & Cox Stock Fund (DODGX) and Dodge & Cox Balanced Fund (DODBX) to new investors beginning today, Monday, February 4, 2008. Both funds were closed in 2004 to new investors, although existing investors were permitted to continue investing in the funds. I’ve owned DODGX for a number of years and have been very happy with its performance. Last year, however, was not the fund’s best, which has led to increased redemptions. Now Dodge & Cox is in a position to handle more capital in both of these funds, thus prompting it’s decision to open the funds to new investors.

Read the rest

. . .but it sure is fun. Congratulations go out to Mike, Cynthia and Jack (check your email), who won the 3 book giveaway. Using a random number generator, I used three random numbers to select the winners from the email entries. Each winner will be receiving copies of the following three books:

I want to thank everyone who entered the contest. If you didn’t win, I still highly recommend Rick Ferri’s investing books. And to everybody, remember the wise words of Ralph Waldo Emerson:

Win as if you were used to it, lose as if you enjoyed it for a change.

As you may know, I’ve decided to invest roughly 50% of the earnings from The Dough Roller in B shares of Berkshire Hathaway. (The other half goes to charity.) I say roughly half goes to the B share because a small portion of the 50% I keep goes to loans on Prosper and Lending Club. As of the end of 2007, I had $910 to invest in the B share. The problem is that a single B share, even with the market decline, costs over $4,000. One option would be to save up enough for a share, and invest it using Zecco at no cost. I’ve decided to take a different approach, however, and use ShareBuilder.

ShareBuilder, as the name suggests, is a low cost way to make small monthly investments. One of the great features is that you can invest in partial shares. So I don’t have to save up $4,00o or more before buying a B share. Instead, I can make small monthly contributions in the B share at a cost of only $4 per purchase. Setting up the account was simple. It links to my checking account and I can transfer funds to and from the ShareBuilder account with a few clicks of the mouse. Also, while my money is sitting in ShareBuilder’s money market account waiting to be invested, I’m earning a descent interest rate (about 4% now). Note, ShareBuilder was recently bought by ING Direct, so the ShareBuilder website is now orange. As an ING Direct account holder, I like that the two companies have joined forces.

Read the rest