About Retirement Calculator, Inc.

Recommended Reading

• The Nervous Retiree
• Why You Need Retirement Calculator Software
• Analysis of the Economics of Early Social Security Withdrawal

403b Savings Calculator

What Can You Do With a 403b Savings Calculator?

Those individuals who work for a variety of non-profit agencies, colleges and universities and local governments often have an employer sponsored 403b account rather than a more common 401k. Just as with a 401k, those who have 403b accounts may find that their contributions are matched by their employers or not. Likewise, those who have a 403b account are given choices about how they want to invest, how much they want to invest and whether or not to open additional savings and investment accounts to help them prepare for retirement.

A 403b savings calculator, at its most basic, is a tool that enables those of you with 403b accounts to see how much the money that you've put into the account is earning for you. A 403b savings calculator lets you take a closer look at your investments than you are able to do simply by looking at the statement that you receive that's meant to tell you how your account is doing.

However, a 403b savings calculator should do more than just let you see what is there in your account and provide you with some idea about how your money will continue to grow over time. With the right 403b savings calculator, you should be able to:

1. Look at the amount that you are contributing and determine how much of a difference a greater contribution per pay period would make in your retirement saving;
   
2. Look at the different mutual funds and stock options that you have for investing to see whether or not you would benefit by investing your 403b savings differently;
   
3. Experiment with your savings and investment strategy to see whether or not you are investing as well as you could be;
   
4. Consider the past and projected performance of the stocks and mutual funds that are available to you;
   
5. Better understand the risk that you are taking when you choose one investment over another.
   

   Additionally, if not all of your retirement planning is being done with your 403b, you're probably going to want something more than a basic 403b savings calculator - something like the retirement calculator you can download on this page that will allow you to do everything that you need to in order to understand your 403b savings as well as all of your other retirement savings and investment accounts.

   Not only does the retirement calculator allow you to get a feel for your accounts on your own, but when you download it your contact information will be forwarded to a financial advisor in your area who will call to follow up and answer any questions that you have. In other words, you won't just get a 403b savings calculator or a retirement calculator, you will also get the chance to talk about your goals and options with someone who can help you to develop a better strategy - a plan for reaching all of your goals, whatever they may be.

   Does the 403b savings calculator you've been using do all of that?

Find a Qualified Financial Planner in Your Area

Do You Know the Answers to These Important Retirement Questions?

• Are you retired or thinking about retiring?
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• Are you looking for help to achieve your long-term financial goals?
• Would you like to learn more about Annuities, 401's, Life Insurance and Long Term Care?

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Analysis of the Economics of Early Social Security Withdrawal

Robert J. Phillips
Chief Retirement Consultant

Deciding whether or not to take the early withdrawal of social security at age 62 can be difficult. If you need this income at 62 to fund your retirement the decision is fairly straightforward. Take it early! On the other hand, if you have another source of revenue to fund your retirement your decision will be primarily based on lifestyle, health and investment preferences.

Several factors can affect your decision. First is your life expectancy. If you are in good health and have a family history of living beyond 90 then waiting for full benefits may be best. Two other factors impact this decision. First and most important is the value of money or your expected return from your investments. If you are using other investments instead of social security to fund your retirement you should use the rate of return of these investments as your value of money. There is another way to look at the value of money. If you do not require the social security money to live, you can invest the distributions for the future. The rate of return of this investment is your value of money. If your investments will make larger returns such as stocks this would favor taking the early withdrawal.

The last factor impacting your decision is inflation. Social security includes an annual adjustment based on inflation. You cannot control this variable but you should be aware of its impact. If future inflation is significant it will favor a later full distribution

FREE Social Security Calculator:

We developed a calculator to assist in analyzing the impact of taking early benefits at age 62 or waiting for full benefits at age 66 to 67 depending on the year you were born...If you were born in 1960 or later your full benefits will begin at age 67 and your reduction for early benefits at age 62 will be 30%. If you were born between 1946 and 1960 your full benefits begin as early as age 66. We have included a chart that summarizes information.

To use the calculator you need to input your year of birth. You also need to input a value of money up to 10% and a projected inflation adjustment. The calculator analyzes income generated over time from both the early and full benefit investments. It calculates the age at which full social security will catch up and breakeven with the early withdrawal. If you were born before 1960 your breakeven age will be impacted by the year you were born. An early breakeven age favors waiting for full benefits.

The social security calculator is not the final answer whether to take an early withdrawal but it does give you additional economic data to assist in that decision. Ultimately you must balance income, investments and lifestyle to optimize your enjoyment during your retirement years.