DIY Financial Planning

Calculator Sites

Two companies operate websites that are just filled with calculators for many different questions, from paying down debt to refinancing a house, to how much you need to save fore retirement and how contributing to your employer’s retirement plan will affect your take-home pay. They’re a perfect place to start looking for answers. Of course, they handle the straight mathematical questions best, and aren’t as great for complex decisions that need lots of info to answer well. Nonetheless, they should probably be your first stop for most financial questions. Both of these companies license their calculators to other business, such as banks, accountants, financial planners, insurance companies, etc. That’s how they make their money. But they are free for the general public to use.

https://www.dinkytown.net/

https://www.calcxml.com/do/financial-calculators

Income Tax Projections

TurboTax: While you can purchase the online version of TurboTax at https://turbotax.intuit.com/, the review was based on the downloaded version, which can be purchased from many retail outlets. You can purchase an actual CD or pay for a license that lets you download the software. The CD or downloaded version can usually be loaded onto more than one computer.

Beware of deals that offer exceptionally good prices; check to be sure they are the current year edition.

There may be additional costs beyond the purchase price. Some include only the preparation of your Federal return, and include the ability to e-file that return.  Some versions include state software for 1 state. Otherwise, you’ll have to pay an additional fee of around $40 to download the state software, And pay that same amount again if you have income and need to file taxes in another state. Almost none of the TurboTax versions include for state returns which cost around $25 per return. The e-file fees typically go up if you file after a certain date, perhaps March 1.

Quicken is a desktop app, sold as an annual subscription. You can purchase it online at https://www.quicken.com/ or from many different retailers. The reviewed version was Quicken Home & Business. The Premier edition also contains all of the tax and investment features discussed in the program.

Flowcharts and Checklists

fpPathfinder at https://fppathfinder.com/ publishes flowcharts and checklists to help with many decisions, especially related to IRAs, employer retirement plans, Roth conversions, and Social Security. You can purchase a year’s access for $99. But you can also access these tools and download them for free from a website operated by Andy Panko, a financial planner who owns a license for these tools and posts them where anyone can download them for free. Go to the Free Stuff section of the website at https://retirementplanningeducation.com/free-stuff.

Specialized Calculators

Social Security

There are lots of free Social Security calculators available online. Some will just estimate your benefit. Others will recommend what claiming strategy might work best for you. Many of them are fine for getting a general idea of the options available to you. But when it’s time to decide and start (or delay) your benefits, you want a tool that will consider all of the unique situations that could affect your benefits and the strategy that will yield the best result for you.

Step 1 should always be the Social Security website where you can get the most accurate estimate of your future benefits. There is one main calculator, and others for people who are receiving a pension from a job where they did not pay into Social Security. You can access all of them from ssa.gov/benefits/calculators/.

The best free tool for claiming strategies that I know of is opensocialsecurity.com/. It handles many of the special situations and rules, such as dependent children, working while receiving benefits, pensions from jobs not covered by Social Security, and disability.

Maximize My Social Security is the best, and most complete claiming strategy tool that I tested. It costs $40 per year. It’s an online tool that says upfront that they cover all major Social Security benefit rules, and all major Social Security benefits. Go to maximizemysocialsecurity.com/.

Risk Tolerance & Asset Allocation

There are also lots of tools (questionnaires) online to figure out your risk tolerance and risk capacity. They’re often called investor questionnaires, or investor profile tools. Two that I think do a good job of asking the kinds of questions that will result in a useful answer are from Vanguard https://vgi.vg/43S9se1 and Schwab https://bit.ly/Schwab_Risk. The real URLs for those are quite long and messy, so I used the bitly shortening tool so that you don’t have to type in 100 characters if you type it in manually.

Because all of these tools ask slightly different questions, I suggest always trying at least 2 of them. Do a web search, or look on the website of the company that custodies your employer retirement plan or your personal investments. They likely all have one. You may get slightly different results with each one, and you may feel that one asks questions that are more pertinent to your situation than the other.

Financial Planning Software

Financial planning needs to pull together many of these pieces into a cohesive whole. I found two existing online tools, available to individuals, that do that.

Retirement Planner by Empower/Personal Capital: When I tested these tools around April 20th, 2023, the Empower Retirement Planner (formerly apparently Personal Capital) was available for free at bit.ly/PersonalCapPlanner. If you go directly to the Employer main webpage, you will not be able to access it without opening an investment or IRA account. Ironically, Empower provides a streamlined version of Retirement Planner to people who have workplace retirement accounts with them, but that version is missing some of the most valuable tools included in the free version. It is possible that the free version is being phased out. Please let me know if the link I’ve provided is not longer working, or if it starts to require you to open an account with them.

maxifiplanner.com/ is the most complete financial planning software currently available to individuals that I have found. It was developed by Dr. Laurence Kotlikoff, a respected economics professor. He is also the creator of Maximize My Social Security. It costs $109 per year, or $149 with some added features like Monte Carlo simulations that will help you evaluate the amount of risk in your plan. If you renew for another year, you get a price break: $89 or $109. There is a learning curve with this software, but there is ample help available in the form of videos, topical articles, question buttons on many data entry fields or terms, a Help button on every page, and even Office Hours webinars they just started in April 2023. You can learn quite a bit about how the software works and what it can do for you on its website.

Roth Conversions

This section will be complete soon. Please come back in a day or so.

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