Plan Your Retirement.com

Someday, when you retire, you will have plenty of time to explore the Web for hours, looking up everything from adventure travel to Zen Buddhism. But for now, take what precious time you can afford at your computer and use the latest electronic tools to plan for that blissful someday. It's quick and relatively painless.

Given the many software programs that also tap into a wealth of online information and the free Web sites that can calculate retirement expenses in minutes, flesh-and-blood financial planners must be shaking in their shoes. Who needs them anymore? In just one session with either technology, you can get an idea of how much money you'll need in retirement, plus how much you'll need to save to get there. More sophisticated programs can tell you exactly how to invest, how your pension will play out, and how much you'll spend on taxes.

All retirement-planning programs work basically the same way. You tell the program how much you think you'll spend in a year of retirement living; it factors in your life expectancy and then tells you how much of a nest egg you'll need in order to provide that kind of income for the rest of your life. Next you tell the program how much money you've already saved for retirement and what benefits (such as Social Security and pensions) you expect to receive. The program then calculates the gap between what you'll have and what you'll need--and tells you how much you should save annually to make up the difference.

But don't count on your computer to help with the hardest tasks of retirement planning: figuring out what you'll do when you're retired and then putting enough money aside to actually do it.

Before You Start

Your retirement-planning sessions will run more smoothly if you gather your financial data before you even turn on the computer. Here's some information you'll be expected to provide, and where you can find it.

Your current income as well as what you anticipate your future income will be. For example, do you get a 3 percent cost-of-living increase every year? Are you in line for a better job that will earn you another $10,000 annually?

Your estimated Social Security benefit. Most retirement-planning programs will provide an estimate based on your income, but it couldn't hurt to get a personalized statement. Log on to Social Security Online to request one. Or just be patient: This year, the Social Security Administration begins sending estimates to most workers on an annual basis.

Your current assets. Gather the most recent statements from your IRAs, company 401(k) plan, and regular investment accounts.

The value of your home. Do you want to use your home as a financial asset in retirement, either by selling it and moving to less expensive digs, or by taking out a reverse mortgage to tap your home's equity while you still live in it? If so, you'll need a rough approximation of what it's worth in today's market.

Your company pension plan. Will you receive monthly retirement benefits from your employer? Ask your human-resources department to estimate what those benefits are going to be.