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How to Use the Retirement Calculator in Quicken 2010

Maybe you want to do some financial planning for retirement. Quicken 2010 provides the Retirement Calculator to help you figure out how long till you can retire and live the good life.

1

Click the Planning tab, and then click the Financial Calculators button and select Retirement Savings from the pop-up menu that appears.

Quicken displays the Retirement Calculator dialog box.

2

In the Current Savings text box, enter your current retirement savings.

For example, enter what you have in an IRA or employer-sponsored 401(k) account. Don’t worry if you don’t have anything saved — most people don’t.

3

In the Annual Yield text box, enter the percent of the expected annual yield.

The stock market, for example, produces an annual yield of about 9 percent over long periods of time.

4

Type the amount that you or your employer will add to your retirement savings at the end of each year in the Annual Contribution text box.

For example, you may plan to add $6,000 each year.

5

In the Current Age text box, type a number.

You’re on your own here, but you should probably be honest.

6

In the Retirement Age text box, type a number.

Again, this is purely a personal matter.

7

Enter a number in the Withdraw Until Age field.

Not to beat around the bush, this number is how old you think you’ll be when you die. Make this age something pretty old — like 95.

8

Enter any other income you’ll receive — such as Social Security — in the Other Income (SSI, Etc.) text box.

This income is in current-day, or uninflated, dollars.

9

Select the Tax Sheltered Investment option button if your retirement savings earns untaxed money, or select the Non-Sheltered Investment option button if the money is taxed.

Tax-sheltered investments are such things as IRAs, annuities, and employer-sponsored 401(k)s and 403(b)s. A 403(b) is kind of a profit-sharing plan for a nonprofit agency.

10

Enter your current marginal tax rate, if needed, in the Current Tax Rate text box.

If you’re investing in taxable stuff, this value is the combined federal and state income tax rate that you pay on your income.

11

In the Retirement Tax Rate text box, enter your anticipated retirement tax rate.

Remember that the Annual Income After Taxes is really your pretax income (just as your current salary is really your pretax income).

12

Enter the anticipated inflation rate in the Predicted Inflation text box.

By the way, in recent history, the inflation rate has averaged just above 3 percent.

13

Select the Inflate Contributions check box if the additions will increase annually by the inflation rate.

For example, your salary and 401(k) contributions will presumably inflate.

14

After you enter all the information, click Calculate and take a peek at the Annual Income After Taxes field.

If you want to see the after-tax income in future-day, inflated dollars, deselect the Annual Income In Today’s $ check box but leave the Inflate Contributions check box checked.

To get more information on the annual deposits, balances, income, and so on, click the Schedule button, which appears on the face of the Retirement Calculator dialog box. Quicken whips up a quick little report showing the annual deposits, income, and ending retirement account balances for each year you plan to add to and withdraw from your retirement savings.

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