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Want to do more for your retirement?

Using a simple retirement calculator is a great start, but it also raises new questions:

• How will taxes affect your retirement plan?
• Should you pull first from your 401(k) or your Roth IRA?
• If you buy a getaway cabin today, how will that affect your retirement?

The best way to plan for retirement is with a comprehensive analysis based on your actual finances—one that lets you run different scenarios to help you plan ahead.

The interactive Lifetime Planner in Quicken for Windows helps you build a complete retirement plan step by step, with “what-if” tools to help you keep it on track.

Shore up your savings with these helpful tips

Whether you’re falling short of your goal or you just want to save more, there are plenty of ways to change your retirement picture for the better.

Add up to $250 more per month

Need to find up to $250 extra per month? Here are a few simple ideas that can help:

• Cook at home an extra night or two every week, and make the most of leftovers
• Brew coffee at home instead of stopping at the coffee shop every morning
• Run all your errands at once to save on gas
• Change the heating or cooling in your home by one degree
• Or set your thermostat even warmer or cooler when no one is home
• Switch from name brand to generic groceries for things like chips or pasta

Add from $250 to $500 per month

Need to find a little more? Up to $500 extra per month? Combine the methods above, and consider adding some of these:

• Switch to a less expensive insurance provider
• Pay down debt to free up that monthly payment
• Save up ahead for vacations and holidays to avoid credit card interest
• Cancel any subscriptions you’re willing to give up

Add more than $500 per month

Need even more? Consider bigger moves to get your retirement back on track:

• Move to a smaller living space, or live with family or friends
• Start a side gig to make extra cash
• Consider retiring a few years later
• Take it up a notch at work and push for promotions
• Change your retirement expenses by changing your plans

How much will you need to retire?

If you play with the retirement calculator for even a few moments, you’ll realize quickly that there’s no simple answer to this question.

As a start, how much you’ll need depends on how much you’ll spend, and even that isn’t set in stone. Plus, other sources of income can play an important role in determining what you’ll need to draw from your retirement savings. The more you expect to receive through Social Security or pension payments, for example, the less your retirement savings need to provide.

Changing healthcare needs also might (or might not) increase your spending, while qualifying for Medicare will change some financial pictures for the better.

Discounts for seniors and organizations such as AARP can make it easier to make ends meet, and many retirement communities offer fixed living expenses to help you plan for your long-term needs.

With so many factors to consider, the first step in figuring out how much you’ll need is to determine a reasonable monthly spending budget for your retirement.

Estimate your retirement budget

This retirement calculator starts with a monthly spending budget of 70% of your current gross income. In other words, if you earn $100,000 per year, the calculator assumes you’ll spend about $70,000 per year in retirement. To get your monthly budget, it divides that amount by 12.

It’s a reasonable place to start, but there are a lot of other factors to consider. For example:

• If retirement is still many years away, your income today probably doesn’t reflect what it will be when you retire.
• If you expect to downsize in your retirement, this could significantly reduce your spending, making it easier to reach your retirement savings goals.
• Paying off your mortgage is a huge life event that will reduce your spending each month by eliminating your mortgage payment.
• Traveling in retirement can be expensive, depending on how and where you expect to travel. This and other lifestyle choices can change that estimated budget a lot.

Still, before you reduce yourself to a bare-bones budget trying to make future ends meet, work through the other factors below. There are a lot of other ways to make your retirement picture look brighter.

Estimate your retirement budget

This retirement calculator starts with a monthly spending budget of 70% of your current gross income. In other words, if you earn $100,000 per year, the calculator assumes you’ll spend about $70,000 per year in retirement. To get your monthly budget, it divides that amount by 12.

It’s a reasonable place to start, but there are a lot of other factors to consider. For example:

1. If retirement is still many years away, your income today probably doesn’t reflect what it will be when you retire.
2. If you expect to downsize in your retirement, this could significantly reduce your spending, making it easier to reach your retirement savings goals.
3. Paying off your mortgage is a huge life event that will reduce your spending each month by eliminating your mortgage payment.
4. Traveling in retirement can be expensive, depending on how and where you expect to travel. This and other lifestyle choices can change that estimated budget a lot.

Still, before you reduce yourself to a bare-bones budget trying to make future ends meet, work through the other factors below. There are a lot of other ways to make your retirement picture look brighter.

Factor in additional income sources

One thing that can help you breathe easier is adding up any other sources of income you might receive in your retirement and including them in your plan.

Add up any additional income sources for a total monthly amount and enter it in the Other expected income box of the calculator. Here are just a few examples.

Social Security benefits

You can start collecting Social Security benefits as early as age 62, but you’ll receive more money for the rest of your life if you delay your benefit until you reach the age of 67. If you’re not sure how much to include, you can use this free tool to estimate your Social Security benefits.

If you don’t want to use your current earnings history, use this tool instead to enter hypothetical scenarios (without logging in).

Pension plans

Pension plans aren’t as common as they used to be, but there are still many professions that offer a traditional pension plan with guaranteed retirement income. For example:

• Teachers
• Professors
• Government employees
• Utilities personnel

Other organizations that might offer pension plans include hospitals, insurance companies, and Fortune-500 businesses.

VA benefits

The term “veterans benefits” covers a wide range of benefits depending largely on your length of service. VA healthcare, military health insurance, VA pensions, and full military retirement are just a few examples.

If you qualify for any of these—VA pensions require less time on active duty than you might think—be sure to include them in your retirement plan.

Annuities

If you’ve purchased an annuity for your retirement, be sure to include that future monthly income amount in the retirement calculator. You might also receive an annuity from a lawsuit through a structured settlement. Remember to include that income too.

Rental properties

Rental properties are another kind of investment that can provide passive monthly income for your retirement. Because rental price increases over time often match (or exceed) inflation, these can make a big difference in your retirement portfolio.

Rather than including these assets with your current retirement savings, consider including the monthly income stream as part of your additional future income instead.

Inheritance

Finally, if you expect to receive any kind of trust fund or other inheritance, consider including the current value of that inheritance in your current retirement savings, or including that future income stream in your additional future income.

Whichever you choose, only enter it once—either in Savings so far or in Other expected income, but not both.

Plan for a long, active retirement

With a healthy diet, moderate exercise, and regular preventative healthcare visits, many people are able to enjoy the freedom of retirement for a full third of their lives, or even longer! As a result, it’s becoming more and more important to plan for a long, active, vibrant retirement.

Today’s continuing care retirement communities (CCRCs) offer a wide range of activities, lifestyle choices, and living expenses. If you’re having trouble setting a retirement budget, consider researching the options you’re most interested in to get a feel for your price range.

It’s also a good idea to set aside something extra for healthcare. As a place to start, Fidelity estimates that the average retired couple needs about $300,000 for healthcare costs.

Once your everyday living and healthcare expenses are covered, include something extra in your retirement budget for whatever you love to splurge on. From fishing vacations to family holidays, retirement is meant to be enjoyed. Be sure you have the funds you need to make the most of it.

Finally, think about your goals for legacy gifts and any inheritance you might want to pass on to future generations. If certain bequests are important to you, it’s best to plan ahead.

What else impacts your retirement savings?

The retirement calculator also lets you experiment with different levels of inflation and investment performance. While you can’t control these factors, seeing how they could affect your retirement is an important part of the planning process.

Inflation

In recent years, inflation has hovered around 2% annually, but it has risen significantly in 2021. Higher inflation means higher living expenses, which could have a large impact on your future plans.

The retirement calculator assumes an inflation rate of 3% per year. If your retirement is still years away, be sure to keep an eye on the actual rate. A rate above 3% would require extra savings to compensate.

Investment performance

The rate of return you’re able to achieve in your investments is another key factor in determining your ultimate nest egg. The calculator assumes a rate of 6% per year while you’re saving up for retirement, then 5% after you retire.

Outperforming this rate consistently would help you reach your goals faster, but financial advisors often recommend a more conservative portfolio the closer you get to retirement. Before making any drastic changes, consider consulting a financial advisor to plan how your investments should change over time.

Taxes

Due to the different rules regarding the taxation of retirement savings based on the type of account, a smart tax strategy can be critical to a successful retirement. Work with your financial professionals to make sure you’re up to date on the most recent tax laws so you can utilize all advantages possible to preserve your wealth.

If you want to include taxation in your plan, consider using Quicken’s advanced retirement calculator or Lifetime Planner. Both tools let you evaluate your retirement plan in more detail, using your actual financial data and applying current tax regulations.

Bottom line

Clearly, there are a lot of moving pieces when it comes to planning your retirement. If you want to bring them all together and see everything in one place, consider using Quicken to track your finances—income, expenses, savings, debt, retirement investments, assets, total net worth, and much, much more.

Using your real financial data, and keeping that data updated automatically, is a much easier and more comprehensive way to keep your retirement plan on track.

If you’re ready to get started, Quicken offers a 30-day, money-back guarantee, so you can download it today and try it risk-free.