It's never to early to start thinking about retirement. Before you start
dreaming of the perfect golf game or a round-the-world vacation, consider
how you'll pay for it.
"The Internet has had a tremendous role in educating consumers about
investing and financial services," says Kenn Tacchino, associate professor
of taxation at Widener University and author of several books, including
"Financial Decision Making at Retirement."
"Retirement planning really didn't
exist in the early 80s," Tacchino said. "Nowadays, it's on everybody's mind."
Start Estimating
Where to start? The Mississippi State Extension Service offers tools to help you estimate everything from annual
inflation rates to life expectancy. The Department of
Labor Pension and Welfare Benefits Administration offers a section on
retirement plans, benefits and savings.
Once you've estimated expenditures, balance them with
your sources of income, including
Social Security. At the Social Security site, you can calculate benefits or request a
personal earnings and benefit statement.
If your expenses outweigh income, look into savings opportunities like
Roth IRAs or 401(k)s. Financial services firms often provide helpful information, adds Tacchino.
Retirement calculators can also help you determine what money you'll have.
But beware, says Tacchino: "The variance between these services is amazing-
the calculator at
T.Rowe Price is easy enough for a
third grader to use. He suggests Quicken and the
American Savings Education Council Ballpark E$timate for middle-of-the-road calculators. Also, the foolish investors at
The Motley Fool offer a variety of retirement calculators organized in a FAQ format.
In the end, Tacchino says the Web should only be a stepping stone in your
financial research. Since most of the information is not geared specifically
to your personal needs, he suggests speaking with a financial planner. As he
says: "We wouldn't think twice to use a travel agent for a one week
vacation, so why not use a planner for a 30-year retirement?"
--- M. Magnarelli
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