Six Antidotes For Old Age

Planning for retirement. Could there be a less inviting weekend pursuit? Not for most people. First off, it's boring. Besides, plotting your income and expenses for the next 40 or 50 years seems like rank speculation when today's finances are, shall we say, uncertain. The tantalizing premise hovering over a batch of new retirement-planning software is that it will dispatch with such piddling problems. It won't, of course. What software can do is make it easy for you to experiment with financial plans without all the tedious calculations. That may not sound like it's worth $15, much less $59.95. But it is, even if the numbers say your retirement dream is a fantasy. Why? Because electronic planning coddles you into making a start, and then improving upon it. And because, frankly, it's a relief to know where you stand--for better or worse.

Even the best programs won't perform without good information. First, dig out records of all your investments and assets, your tax return and your salary history or old W-2 forms. A program can be badly skewed by underestimating your living expenses. Before you pop a disc into your computer, look through two or three months of checkbooks and credit-card receipts so you can estimate your monthly expenditures reasonably well. Don't forget to tally your recurring cash outlays, too.

Here's a look at six of the leading programs.

If you don't have plain old Quicken, the financial-management program, this brand-new tool will convert you to the cult. The graphics are crisp, the design intuitive. Entering some of these programs is like spelunking in a dark cave--you have no idea where you are or when you'll get out. Quicken solves this problem by stretching a button strip of simply titled sections along the right side of your screen, More important, it slips great sophistication into your plan without intimidating you. For example, you learn about asset allocation, a key concept that involves rethinking how much of your savings should go into different types of investments, by tinkering with different rates of return. The advice boxes, written by NEWSWEEK columnist Jane Bryant Quinn, tackle some of retirement planning's most subtle points in blessedly clear language.

Quicken's great coup is that it diagnoses your financial ailments and prescribes specific cures. Most retirement programs leave you to ponder the red ink in your future on your own. Quicken warns you, nicely, about you r condition in text and wonderful charts. Then it tells you how much to save every month, where the savings should be stowed and how to rebalance your portfolio. The analytical tools are sharp. You can summon information on 4,400 mutual funds or search for funds that meet your standards. (You'll get a free update of this embedded database when you register your software. It will cost you an additional $39.95 to be updated quarterly after that, however.) Folks who don't rush home to record every daily purchase can punch in a single number for yearly expenses. That benevolent attitude is what will make you want to revisit the program with more precise figures.

This program, by Datatech Software, wants to take care of you. A "walk-through" guide leads you gently along. You're quickly rewarded for whipping through the first few screens when Rich and Retired calculates the size of your nest egg and social-security paycheck on retirement day. You still have to enter endless information about expenses and investments. But the screens are well laid out, the language is plain and when the guidance of an on-screen genie box fails, a help button usually delivers.

This easygoing style, plus the program's ability to incorporate budget details from Quicken or Meca Software's Managing Your Money, has made Rich and Retired popular. But it falls short next to Quicken's new package. Most of its flaws are modest. For example, Rich and Retired won't let you eliminate social-security payments from your future ff you aren't counting on them. It occasionally indulges in clunky, confusing language, such as "Default Yield for the Asset Category Plus." It's easy to miss a screen that shows eight key inflation, interest-rate and other assumptions underlying the whole program. The biggest problem, however, is that it doesn't give you the scope that Quicken does. You aren't given a history of inflation rates to help you choose one that seems realistic for the next 45 years, for example. Rich and Retired does try to advise you on problems that crop up, but the-suggestions aren't convincing. You'll need to do the analysis yourself.

Leave it to an accounting firm to give you a screen that's first CouSin to a federal tax-return form. This program, developed by accounting giant Price Waterhouse, covers the basics and is the only one to suggest that your expenses could vary considerably during retirement. But its screens are almost painful to look at. Quicken and Rich and Retired coax you from one data-entry chore to the next. Retirement planning superimposes a dense screen of text over the page it's referring to. Once you click OK, you're faced with entire screens of blank spreadsheets to fill out. The payoff? A set of hard-to-read budget projections, some lame graphs and not a speck of insight about how to tackle that seven-year shortfall at the end of your life.

Schwab's package would be pretty good but for two problems: its unimaginative design and its transparent bid to get your mutual-fund business. Going through FundMap feels like you're simply reading and filling out an electronic version of a workbook. Not a very engaging one, either. Big chunks of information are unloaded on you long before you need them. Schwab's interest in capturing you as a customer is even more frustrating because it spoils some of the program's best features: a valuable exercise in allocating assets and a thorough examination of your tolerance for risk. At the end of the program, FundMap helps you match your ideal portfolio to specific funds. But instead of giving you data on the thousands available through and elsewhere, it lists only a handful that can be bought with no fee through the company's OneSource program. For some reason, Schwab decided to ignore individual stocks and bonds altogether-curious for a brokerage firm, and a big omission for a program that's supposed to lay out all the alternatives in planning for your old age.

This $15 cheapie was a surprise. It's a heavily disguised pitch for Vanguard's funds--and a long way from comprehensive--but a serviceable way to get a thumbnail sketch of your retirement picture. Strengths: highly navigable screen designs, nifty charts and instruction on asset allocation. Weaknesses: it's unsophisticated and can't handle much deviation from what Vanguard thinks is the norm. A glaring example is the program's assumption that only men are using it and that their wives have little or no work history. It's nice not to have to enter reams of living expenses. But when a program allows you to leave out budget busters such as child care, you have to question its conclusions.

Fidelity's software seems to think the worst of you. "You've probably been losing ground," it surmises disapprovingly. Thinkware is far more of a tutorial than a usable tool. But even its educational value is ruined by a school-marmish tone and a style that harks back to the earliest consumer software. "Just as a carpenter building a house has many power tools to make the job easier and the final product better," it singsongs, "so too the world of investing has many 'investment power tools' available to help you meet your retirement goals." You had enough of this in the second grade. Thinkware won't let you use a mouse and doesn't even provide investment returns for the Fidelity funds it mentions. A big disappointment.