While pensions are not nearly as common as they once were, they are a very important part of the retirement plans for many of society’s most valued workers: teachers, police officers, fire fighters and more! However, it is surprisingly hard to find a reliable retirement calculator with pension controls.
Whether you have a state retirement pension, federal retirement pension or private retirement pension, here are some tips for finding and using a retirement calculator with pension.
First Up, Which Are the Retirement Calculators With Pension Controls?
Even though millions of people still have pensions, almost none of the most popular retirement calculators offer pension inputs. Of the few that even mention pensions, only one offers you really meaningful inputs.
Some calculators like the CNN Money calculator group pensions with Social Security and other income. This is not a great idea since you may have completely different start dates for these income sources.
The Vanguard Group calculator allows you to enter what percentage of your retirement salary will be from a pension — but not dollar amount, start date, adjustments, etc…
The NewRetirement retirement planning calculator offers A LOT more than any of these other options.
- Lump Sum or Monthly Payments: To start, you can opt to enter either a lump sum pension payout OR monthly payments. This alone is hugely useful, enabling you to compare which type of pension will have the best impact on your overall retirement finances. Go back and forth between options and play with the numbers until you are satisfied with your decision about your pension.
- No Limit on Number of Pensions: For both you and your spouse, you can include as many different pensions as each of you actually have.
- Tax Status: You can also specify whether or not each of your pensions is taxable.
- Start Age, COLA, Taxes and Survivor Benefit:
- If you have selected a monthly pension benefit, you specify the exact start age, whether or not there will be a cost of living adjustment, tax status and — if you have a survivor benefit — what percentage of your benefits your heir will receive.
- If you select a lump sum payout, you specify if it is taxable, the savings account to deposit it into, and the age when you will receive the benefit.
What Else is Important in a Retirement Calculator with Pension?
If you are serious about retirement planning, then you need to use a retirement calculator including pension inputs as well as one offering a comprehensive set of questions about other factors impacting your retirement.
Some of the following considerations may be particularly important to people with pensions, but most are critical factors to almost anyone who wants a credible retirement plan:
Retirement Job: Many people who retire with a pension opt to work in some kind of retirement job. It is important that your retirement calculator lets you set as many different work income phases as you might have. And, passive income sources as well.
Housing: Do you plan on moving after retirement? Downsizing or upsizing? Look for a calculator that factors in your housing wealth. If you own, this is probably your most valuable resource.
Social Security: Not all pension recipients are eligible for Social Security, but many are. You will want the option of entering a Social Security start date which could be different from your pension start date. (If married, you also obviously want separate controls for your spouse. See more about special considerations regarding retirement calculator for couples.)
Expenses: After retirement, your spending is likely to evolve. Make sure you use a retirement calculator that allows you to customize different phases with different levels of spending.
Assumptions: Most retirement calculators ask very few questions and make a huge number of assumptions. However, you are not likely completely average. If you want a reasonably accurate retirement plan, you will want to be able to play with all of the details — inflation, medical spending, rates of return on investments, debt levels, how to manage a possible long term care event and much more.
How Much Savings do You Need if You Have a Pension?
How much retirement savings you need if you have a pension will vary pretty dramatically from person to person.
It all depends on how much you spend, do those expenses change over time, do you have expensive health issues, how much of your retirement income is guaranteed for life, etc…
The basic math for figuring it out is to add up all of your lifetime retirement income sources (pension, Social Security and annuity or passive income) and see how that compares to your projected retirement spending. If there is a gap, then you need retirement savings to fund that difference.
However, the easiest way to figure out how much savings you need is to use a retirement calculator with pension controls. Just be sure that the tool you use is detailed and reliable.
The Best Retirement Calculator Including Pension
Most retirement calculators are fairly simple and only ask you for a little bit of information and then they make a bunch of assumptions to fill in the rest of the details.
These can be good for a quick estimates. But, if you are serious about retiring and especially if you have a pension, you need a tool that can really calculate the details of your own finances.
The NewRetirement retirement planning tool has been named a best retirement calculator by the American Association of Individual Investor’s (AAII), Forbes Magazine, The Center for Retirement Research at Boston College, MoneyBoss, CanIRetireyet and many more.
The tool is ideal for planning an early retirement because it covers a comprehensive set of information relevant to retirement and lets you customize everything.
See what real users say about the tool. Here is a sampling of recent feedback:
Most comprehensive estimator I’ve found in years of searching!
Atlanta, GA – November 20, 2017
The financial and other personal data questions are the most comprehensive that I’ve seen by light years. I find the tool to be easy to use and pleasantly inviting. I love it so much that I sent the link to all my Facebook contacts. Thank you so much!
Reidsville, NC – Feb 8, 2017
Very concise, intuitive to use, easy to compare different scenarios, and not intrusive, does not need any of your personal details, so even people concerned about privacy can use it.
Madison, WI – Dec 14, 2016
I like that the tool includes the addition of a pension. Not many tools include that. I also like that it gives an optimistic and pessimistic view of future earnings.
Madison, WI – June 24, 2017
Are you ready to retire? Find out with the best retirement calculator for pensions
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