There is a variety of retirement planning calculators (RPC) available on the Internet and elsewhere. ORP is unique for these fundamental reasons:

ORP computes the amount of money you will have each year of retirement in current dollars.

RPCs ask you for your yearly spending requirements in retirement and the term of your retirement plan. Then RPCs calculate your account balances for each year, going into negative numbers if there are inadequate initial savings or leaving a whopper estate if the withdrawal rate is too low. ORP asks only that you specify the term of your retirement, or your drop dead date ;-) if you will, and then computes the amount of money, after taxes, available for spending each year, leaving a specified estate.

ORP separates your tax-deferred investment account from your after- tax savings.

RPCs do not distinguish between tax-deferred and after-tax savings, and thus must avoid the question of income taxes altogether. Income taxes are an important part of the ORP model. ORP not only computes your withdrawal from savings in each year of retirement but it also computes the movement of money from your tax-deferred account to your after-tax account, honors the after 70 minimum distribution requirement, and computes excess distribution penalties.

ORP provides more meaningful results through its treatment of personal income taxes.

There are 3 kinds of retirement calculators: Those that ignore taxes. Those that require that you estimate your tax rate during retirement. ORP, which computes your taxes based on withdrawals, social security benefits, and earned income. Taxes have a significant impact on tax-deferred withdrawals. Ignoring taxes means that funds available for spending in retirement are substantially overstated. Leaving it to the user to guess her retirement tax rate may cause the results to either overstate or understate money available for spending. ORP not only computes taxes according to the IRS schedule, ORP adjusts the tax-deferred withdrawal schedule to minimize taxes paid.

ORP's answer is optimal.

RPCs are straight ahead calculators. They begin with initial values and run their equations for each year of the plan. RPCs cannot tell you if there are better ways of managing cash flow during retirement. ORP computes the optimal answer, meaning that given the initial values, there is no answer that will provide for more withdrawal money during retirement. For a partial list of other retirement planners available through the Internet see also.

© 1998-2000, Sundown Software Systems, Inc.