Regardless of where you’re at in your life and career, the first question we all ask about retirement is, “Do I have enough?” That answer will depend on the lifestyle we envision for our retirement and the things we want our money to accomplish. The traditional thinking is that an individual’s annual retirement income should be between 70–80 percent of our pre-retirement income to support a similar lifestyle. The reality is that a fulfilling retirement, and a legacy that counts, cannot be the sum of such a static equation.

For those of us just starting to think seriously about retirement, the first stop is often a retirement calculator. These tools are widely available on nearly any financial or banking website. They can be useful starting points and, when properly applied, can help us start asking the right questions about our financial futures. However, that should be considered the extent of their utility. They aren’t without their drawbacks, and we should never use them as a proxy for a real retirement plan, especially if we want to maximize our money’s potential and create the best futures for ourselves, our families, and our society.

There are five reasons why I’m always wary of retirement calculators.

Only as reliable as the information you input

This is a crucial factor for anyone just starting on their path towards retirement. Chances are, at this stage, you haven’t done as thorough an inspection of your situation as would be required to get a completely clear picture of your retirement needs. Partial information and miscalculations can only create a hazy vision of your future.

Can’t capture what really matters to you

The primary function of these tools is to give you an idea of your living expenses in retirement and the bare minimum you need to save to get there. In large part, the calculation only captures our needs. This is partly because it can be difficult to think honestly about our future wants in the abstract, and partly because what we’re really talking about preserving is our lifestyle and our legacy, both of which are deeply complex when we think more critically about them. No retirement calculator can help you plan how much you can leave your grandkids or what causes and institutions you want your money to serve.  

Narrow scope of saving options

Most of the sliding scales put forward by these calculators limit your saving options to 401(k)s, IRAs, other traditional investments, and Social Security income. There is no discussion of income and saving alternatives, like charitable trusts, gifting stock, or donating your house. Strategies like these shield your money from taxation in ways that simply withdrawing from a 401(k) cannot, and they can sometimes create income for you. It’s impossible for retirement calculators to factor in these options, limiting your money’s potential and the legacy you leave.


The one certainty in life is that things will change. Retirement calculators are a snapshot and so are incapable of accounting for the role that change will inevitably play in our financial futures. The numbers you’re presented are calculated with the expectation of steady growth, predictable markets, and scalable income. Permanently locking on to these numbers and assuming that they will always be applicable to your long-term plan is a mistake. We need to be constantly checking up on our financial situation and adapting our retirement plans to the world’s constantly changing circumstances. A short-term savings plan that works one year will almost certainly not work as well for the next.

Enables complacency

If you’ve held a loose retirement plan in place for a number of years and are ready to get serious about saving for your future, there’s a good chance that the results of your retirement calculation will be pretty encouraging. It will likely align closely with what you’ve been doing already, and so you’ll continue on the same path, confident in your plan. But, what if you could do even more and still be comfortable, still preserve your lifestyle? When is the last time you felt fulfilled by doing “just enough?” The fact is, when we know we can do more, we want to do more. Perhaps your situation would allow you to set a recurring $1,000 donation to a charity or cause you care for deeply. More than serving just your personal bottom line, this money can help you build a legacy that counts, and serve the greater good. Retirement calculators don’t compel us to entertain these questions and possibilities. If things look good after a superficial calculation, it’s too easy to just close the door on doing more.

How should you proceed with your retirement calculation?

These calculators aren’t entirely useless. Getting to the point of thinking more concretely about your financial future is a major first step. Approaching what comes next with a ballpark figure in mind puts you in the right space to start planning for a successful retirement and finding your money’s greater purpose. To reach those desired ends, we all need the help of an expert. My assessment can provide some clarity for the future and lay the groundwork for an impactful legacy.