Magazine article Medical Economics

The Vanguard Retirement Planner

Magazine article Medical Economics

The Vanguard Retirement Planner

Article excerpt

(Viga Technologies; $18, including shipping and handling)

If you consider yourself an investment illiterate, this program from Vanguard, the mutual-fund company, could be for you. The "primer" section explains rudimentary investment principles such as compounding and tax-deferred growth. A "guided tour" walks you through the program before you begin, so you'll know what information to round up.

The Vanguard software's cartoonish visuals make it look less professional than Quicken Financial Planner, but in many ways it's just as functional. For example, like the Quicken product, Vanguard lets you set two rates of investment return: a higher one for when you're working, and a lower, more conservative one for when you're retired. If you're not sure what assumptions to make-regarding, say, your age at retirement or Social Security benefits-you can use the suggestions that appear on the screen.

Vanguard's program, like the others we reviewed, lets you expand on several of the assumptions. For example, when estimating annual retirement expenses, you can click on the "details" symbol and fill in the blanks next to related categories such as mortgage or rent, food, clothing, utilities, and entertainment.

When you're finished, switch into the "overview" section. Simple bar graphs show what you need to save vs. what you're currently putting away, in dollars or as a percentage of income. Other graphs display your yearly balances during retirement, based on anticipated income, expenses, and life expectancy. You'll see at a glance whether you'll outlive your nest egg.

But when it comes to sheer detail, Vanguard's package can't match the others we examined. …

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