The retirement calculators around the web are so pathetic.

[Rich M]

I know MMM has some spreadsheet links and stuff for retirement, but I continue to browse the web for some calculators for retirement that might be reasonable and realistic for a MMM.  WOW.  So many are amazingly bad.

Most have a number of how much do you want to have as income after you retire recommending 80%.  What?  If we are socking away at least 20% of our income, which we should, aren't we already living on 80%.  Shouldn't the mortgage be gone reducing that percentage? But there is more.  One calculator only allowed me to save no more than 10% because it was making tax exempt assumptions and didn't consider that I might actually save beyond my tax exempt status.  I guess I should be investing in a new car.

Another one, and the most annoying one was back to how much I wished to spend after retirement (A prudential calculator), would not allow me to live on less than 50% of my pre retirement income after I retire?  I mean really!  Is there a requirement of society that we have to spend what we make?  Jeese.

If warren buffet used these calculators, he would have a 2 billion dollar house and three-100 million dollar yachts.

[StashinIt]

http://imgur.com/mfPGJ

These calculators are for people who fall within 2 standard deviations from the mean.

[matchewed]

Interesting. Most calculators I've seen word it as a percentage of expenses not income as the assumption is that you spend less in retirement.

[lauren_knows]

I've considered creating a comprehensive calculator for the MMM-inclined group, but we'd need to nail down all of the requirements, and I'd need to find some freakin' free time :)

[babar]

I went to a deferred comp retirement planning meeting last week and was quietly laughing at the calculator tool examples of "typical expenses". Not only does it assume you still have a mortgage, but that you spend $250+ on household furnishings/supplies, $150/month on clothing, $730/mo on transportation, and over 500 on various "other" categories. I'm guessing the numbers are just the national US averages for such things, but it was nice to be able to just use what my wife and I already spend and mark N/A or 0 next to many.

The biggest IF boils down to healthcare for us, as my wife does have various conditions that add up and sadly we'll have to plan on a budget that assumes maxing out deductibles on any plan we get, so about 25-30% of our total retirement budget after copays and all that. We can retire at 50 thanks to our pensions and paying off the house by then (and selling it to buy a cheaper one and save the extra principle) but when her life literally depends on getting proper healthcare it makes that leap quite stressful.

[strider3700]

Retiring with a mortgage is becoming the new standard.  I know people in their mid 30's with a mortgage just shy of $900,000.  They make $140,000 before tax.   they aren't interest only but their extra payments don't cover enough principal to pay it off in 30years.  They will be forced to take another mortgage in 30 years unless something radically changes and they increase their payments somehow.

Hell it's not uncommon to hear of people already over 65 taking a mortgage out to buy a new property.

[Zikoris]

I recently got a bunch of retirement information from my employer, after getting signed up for matching contributions - my boyfriend and I were alternating between laughing our guts out and banging our heads against the wall as we read through it. There was a link to a retirement planning calculator that won't allow you to put in a retirement age of less than 50. But the best was the sample budgets... good lord... here's the breakdown they gave of an "Extremely Conservative Yearly Budget" for a couple:

Food: $5200
Housing: $13,300
Clothing: $1000
Recreation/Leisure): $1600
Travel: $1700
Transportation: $5900(!)
Health and Personal Care: $3000(this is haircuts and dry cleaning, not health insurance since we're in Canada)
Gifts and Donations: $1700
Tobacco and Alcohol: $1000(!)
Interest Paid: $1800(!)
Taxes: $1800

Total: $38,000 Mind blowing.

[makincaid]

@Rich  Try this calculator. It might work better for you.

http://firecalc.com/

[chucklesmcgee]

Shouldn't the mortgage be gone reducing that percentage?

Well you do have to account for increased medical expenses, the potential need for long-term care, etc. Plus if it's a poor calculator it might not account for inflation and this sort of adjusts- 80% of your salary at retirement might be more than you'd spend, but it'll be much more modest 20 years down the line.

Still it is laughable. The amount of pain I see people in financially while at the same time continuing to buy more useless crap and save nothing is just sad.