The Best Free Retirement Calculators

If there is one predominant concern from our readers here at Cashflows & Portfolios, it’s about sound retirement cash flow planning. That’s probably not too surprising.

These are some of the top retirement planning questions out there today:

1. How long will my money last? Did I save enough?
2. How much can I spend before I run out of money?
3. I’m currently saving $X. Am I saving enough money to retire like I want to?

As a site dedicating to helping Canadians master cash flow management, understand their cash flow; how best to invest that cash flow; and then provide considerations and reports about how to extract that money effectively and efficiently, we know folks want answers to those questions – ideally for free.

So, we’ve identified what we believe are the best free retirement calculators. We encourage you to try them out and see if they do the job for you!

Accumulating Assets is Simple

As you may know, accumulating assets is pretty straightforward:

1. Save and then invest as much of your income as possible.
2. Use tax-sheltered accounts to invest with (such as your Registered Retirement Savings Plan (RRSP), Tax-Free Savings Account (TFSA)), then after those accounts are full of contributions, invest in a taxable account.
3. As part of your investing journey own diversified low-fee investments for the long-term and keep adding with new money when you can.

To help you invest, check out these very comprehensive posts:

• Everything You Need to Know about TFSAs.
• Everything You Need to Know about RRSPs.
• Build wealth using these low-cost ETFs here. 

Decumulating Assets Efficiently can be Complex

Unfortunately, asset decumulation (i.e., spending in retirement) is not quite as simple as asset accumulation.

Some of the “variables” to retirement cashflow management include:

• The different accounts and their withdrawal rules. (For example, with an RRSP you are forced to collapse this account by the end of the year you turn age 71. Converting your RRSP assets to a Registered Retirement Income Fund (RRIF) is a popular and flexible option but it has a complicated withdrawal schedule.)
• Accounting for the pension credit when withdrawing from an RRIF and/or a defined benefit pension.
• Tax rates will vary between provinces and income/account type
• You may consider earning part-time income which can significantly alter any draw-down schedule let alone the timing of asset withdrawals.
• Retirees may sell major assets (such as their primary home, rental property, other) and wonder where and how best to invest those proceeds
• An inheritance to manage
• When to take your defined benefit pension or defined contribution pension
• If you left an employer, you may have a Locked-In Retirement Account (LIRA)
• There are considerations about the best age to take Canada Pension Plan (CPP)
• You may decide to take Old Age Security (OAS) beyond the current start age of 65 and would like to minimize OAS clawback as much as possible.
• And more and more and more….

Check out some of these great case studies about taking CPP and other drawdown scenarios to learn more about your options:

• When to take CPP in Retirement.
• This couple didn’t invest a dime until age 45 (they paid off the mortgage first instead). How much do they need to save to retire by age 60?

Calculators Can Help!

From our perspective, the best way to alleviate this uncertainty is by using a calculator. Better still, use a free retirement calculator!

While the free retirement calculators in Canada are not perfect and cannot answer all these questions above, they can give you a good head start on how much you can expect to spend in retirement without running out of money.

Without further ado here is our list of best free retirement calculators.

Best Free Retirement Calculators

Government of Canada – Retirement Income Calculator 

Our federal government has designed a very good (free) calculator that walks you through your assets and helps you see how each level of the retirement income system (your personal assets, vested workplace pensions, government benefits) will contribute to your future financial security.

What we like

• Helps estimate CPP and OAS benefits but note that the CPP estimator will assume that you work until 65, your benefits may be less if you retire before then.
• Provides a graphical representation of potential income during retirement.
• Provides a table of income sources to fund retirement and will show a surplus/deficit by year.

What needs work

• Does not account for a spouse or partner.
• The earliest age to start receiving retirement income is 50.
• Does not account for provincial taxes.
• Does not show how much to withdraw from each account in tax optimized manner.

Morneau Shepell – PERC 

This calculator was created as a companion to one of our favourite retirement income books out there for Canadians.   As per that site, the PERC is a free tool that lets you calculate how much income you can draw from all of your financial assets in retirement. It is based on the ideas in the book entitled “Retirement Income for Life: Getting More Without Saving More” by Frederick Vettese.  The target audience for this calculator (and the book) is anyone 40+ in our opinion who would like some quick math about their upcoming income sources in retirement.

Check out My Own Advisor’s post about Retirement Income for Life.

What we like

• Ability to include a spouse or partner in projections.
• Provides a graphical representation of potential income during retirement.
• Shows the impact of owning high fee mutual funds (2% MER) vs. lower fee ETFs (0.6% MER).
• Shows the impact of taking CPP at 70 vs 65.
• Shows the benefits of purchasing an annuity.

What needs work

• The minimum retirement age is 50. While this is well below the average retirement age in Canada, there are a number of people on the FIRE by 40’s path.
• Have to manually enter the withdrawal tax rate.
• Does not show how much to withdraw from each account in tax optimized manner.

Vanguard – Retirement Nest Egg Calculator

Financial Mentor – Ultimate Retirement Calculator

Straight up, this U.S. tool will calculate how much you need to save, how long your money will last, and potentially how soon you can consider retirement – all-in-one.

What we like

• Lots of flexibility here including entering life expectancy which can obviously change your drawdown plans.
• Allows you to estimate your tax during retirement.
• Provides a graphical representation of year-end balances (beginning and end).
• We like that you can play with rates of inflation that may alter your retirement income projections.
• You can also add other income streams in retirement, like your side-hobby or other income.

What needs work

• Does not provide any Canadian context, no built-in or designed logic for CPP or OAS government benefits.
• While tax rates are interesting, it does not show dynamic tax rates that could change year by year.
• Does not show how much to withdraw from each account in tax optimized manner.

Are you a fan of FIRE? Try the FIRECalc

Want to retire early like our reader Michelle wants to retire by age 40 in her case study?

If so, FIRECalc is a tool for you!

Also managed out of the U.S., FIRECalc can tell you how much you would have needed to ensure that you wouldn’t have depleted your portfolio too soon in retirement if things went terribly south in the stock market. Like in 1929 (The Great Depression) or even more recently in 2009 (The Great Recession/Financial Crisis).

FIRECalc will show you in a very visual way, just how “safe” your retirement portfolio value might be based on every single U.S. market condition since 1871.

If you leave FIRECalc settings alone, the calculator assumes you’ve invested in a “couch potato” portfolio of 75% U.S. stock index and 25% U.S. bond funds, with a 0.18% fee/MER charge. Inflation is assumed at 3%.

What we like

• Very simple since you can estimate how “safe” your retirement might be (based on some historical assumptions).
• Provides a graphical representation via Monte Carlo simulation.
• Neat to look at some 120 possible 30-year periods in the available data.

What needs work

• Overly simplistic; does nothing to account for tax rates nor changes in spending patters during retirement.
• Does not account for a spouse or partner.
• It’s too basic to provide any actionable details.
• Does not show how much to withdraw from each account in tax optimized manner.

The Retirement Planner Calculator (Canadian)

This is a new tool we found that accommodates some useful sliders and prompts to arrive at your desired retirement income plan. Using this calculator, you can view your retirement savings balance and your withdrawals for each year until the end of your retirement.

What we like

• Very intuitive.
• Accommodates general savings rates with ease – don’t need to worry about TFSA, RRSP or taxable contributions – just pick the desired savings rate (e.g., 10%).
• Includes inputs for CPP and OAS.
• You can adjust rates of return pre-retirement, returns during retirement, and adjust inflation as well.
• Provides a graphical representation if you have enough and what your portfolio balance will be over time, as well as a report view.

What needs work

• Does not account for a spouse or partner very easily, need to lump those values together.
• Does not account for taxes.
• Uses some outdated logic like you will spend 50%-70% of your pre-retirement income.
• Does not account for other potential income streams in retirement, e.g., side-hobbies.
• Does not show how much to withdraw from each account in tax optimized manner.

Final Thoughts – The Best Free Retirement Calculators

No doubt there are others we can add to the list but we believe these free retirement calculators will give you a great start to seeing some of your retirement income questions answered. We encourage all Canadians to check out any FREE calculators or other services to see what is a great fit for them!

We (Mark and Joe) are using professional tools to keep our early retirement on track. In doing so, we can honestly say that has significantly boosted our confidence in our early retirement plans. Our tools not only help answer the questions such as how long will my money last/did I save enough, what is maximum spend during retirement, they also help us understand what accounts to draw down first to be tax-efficient and manage estate values – and much more.

Saving enough is your first priority and investing wisely should be your second priority for retirement. That will get you started. Asset decumulation (i.e., drawing down your portfolio in retirement) is something entirely different and needs much more thought. We hope these free calculators help you out a bit and we’ll keep this content updated as some of our favourite tools evolve.

To go well beyond any simple free tools, to help you solve the retirement decumulation puzzle, let us know if there are any specific scenarios that you would like to see. As well, make sure you subscribe to our site so you never miss a post!

If you are interested in obtaining private projections for your financial scenario, please contact us here to get started.

Disclaimer: Any information shared on our site (“Cashflows & Portfolios” https://cashflowsandportfolios.com/) or related to our site, is for awareness and illustrative purposes only. 

We thank you for reading and sharing!

Further References and Resources:

Not free, but some considerations:

Cascades Financial Solutions – DIY retirement income approaches for DIY investors, no support and features are limited when compared to our services, however, it can work for a fee.

The Money Ready App – another DIY resource but the interface is complicated and your work can be very time consuming.

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