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Use this calculate to project how much your Stock Retirement Plan, also known as your SRP plan, and other retirement income including the benefit you will receive from the Annuity Retirement Plan, could be worth in the future and how long that money will last once you retire. The Stock Retirement Plan, your savings and the generous company match along with The Annuity Retirement Plan are ways Abbott helps you prepare for and enjoy your retirement.
Note: This planner is designed for educational and informational purposes only and it is not intended to be considered investment advice. Regular investing does not guarantee a profit or protect against a loss in declining markets. Please print calculator reports of your results. You cannot save these results in the system.
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Definitions
- Percent to contribute
- This is the percentage of your annual salary you contribute to your SRP plan each year for both pre-tax and Roth(k). This does not include any after-tax contributions or catch-up contributions. The minimum contribution allowed is 2% and you can only contribute full percentages (e.g. 2%, 3%, 10%). Abbott allows employees to contribute up to a maximum of 25% unless you are a highly compensated employee. If you are a highly compensated employee, you are limited to 15% total pre-tax & Roth (k) combined or $17,000, whichever is lower.
- Annual salary
- This is your annual salary from Abbott before taxes and other benefit deductions. Since your contribution and company match are based on the salary paid to you by your employer, do not include any income you may receive from sources other than your employer. Annual Salary is not a year-to-date number and does not take into account any unpaid time off, mid-year merit increases, leaves or new hires starting mid-year.
- Current age
- Your current age using whole years (i.e. 50 versus 50.6).
- Current SRP balance
- The starting balance or current amount you have invested or saved in your account. This balance includes your pre-tax, Roth (k) or after-tax contributions, catch up contributions, and any rollover contribution amounts. It also includes company contribution and any earnings and gains/losses on your account.
- Age of retirement
- Age you wish to retire. This calculator assumes that the year you retire, you do not make any contributions to your plan. So if you retire at age 65, your last contribution happened when you were actually 64.
- Annual rate of return
- This is the annually compounded rate of return you expect from your investments. For the purposes of this calculator, taxation is not factored into the results. If you pay taxes on the interest, dividends or capital gains from these investments you may wish to enter your after-tax rate of return. The actual rate of return is largely dependent on the type of investments you select. The S&P 500 for the ten years ending on December 31st, 2011 had an annual compounded rate of return of 2.92%, including reinvestment of dividends. From January 1970 through the end of 2011, the average annual compounded rate of return for the S&P 500, including reinvestment of dividends, was approximately 10.01% (source: www.standardandpoors.com). Since 1970, the highest 12-month return was 61% (June 1982 through June 1983). The lowest 12-month return was -43% (March 2008 to March 2009). Savings accounts at a bank may pay as little as 0.25% or less but carry significantly lower risk of loss of principal balances.
It is important to remember that these scenarios are hypothetical and that future rates of return can't be predicted with certainty and that investments that pay higher rates of return are generally subject to higher risk and volatility. The actual rate of return on investments can vary widely over time, especially for long-term investments. This includes the potential loss of principal on your investment. It is not possible to invest directly in an index and the compounded rate of return noted above does not reflect sales charges and other fees that funds and/or investment companies may charge.
- Estimated annual salary increase
- The annual rate you project your salary to increase. The calculator projects that your salary will continue to increase at this rate until you retire.
- Years of retirement income
- Years you expect to live while retired. The system will default to 25, assuming age of retirement of 65 and life expectancy of 90, you can enter a different number. According to the most recent study, the life expectancy of an average person based on the age at retirement is as follows:
| Age 55 Male = 80, Female = 85 |
| Age 60 Male = 81, Female = 85 |
| Age 65 Male = 82, Female = 86 |
| Age 70 Male = 84, Female = 87 |
| Age 75 Male = 86, Female = 88 |
| Age 80 Male = 88, Female = 90 |
- Expected inflation rate
- What you expect for the average long-term inflation rate. A common measure of inflation in the U.S. is the Consumer Price Index (CPI). From 1925 through 2011 the CPI has a long-term average of 3.0% annually. Over the last 31 years highest CPI recorded was 13.5% in 1980.
- Rate of return during retirement
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The rate of return your investments are expected to grow each year during retirement.
- Target percent of income at retirement
- Experts recommend you will need anywhere from 80% to 100% or more of your current income to maintain your pre-retirement standard of living.
- Additional current savings balance
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You can add other sources of retirement income either from another 401(k), IRA or a spouse's account balance.
- Abbott Pension
- Your monthly or annual pension estimate from Abbott. Default is your age 65 estimate (or your current age if older than 65). To calculate or model the value at a different retirement age, please visit http://resources.hewitt.com/abbott/.
- Social Security
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A monthly estimate of your Social Security retirement benefit. Social Security estimates are based on an estimate of your final pay at retirement. Default is to begin receiving benefits at age 65. To calculate or model the value at a different retirement age, please visit http://resources.hewitt.com/abbott/ or http://www.ssa.gov/planners/calculators.htm.
- Additional Income
- These fields are manually entered and do not automatically recalculate. Please enter your Abbott Pension and any other additional income sources in these fields based on your projected retirement age. Your projected Abbott Pension at age 55 and 65 (or your current age if older than 65) is available under My Retirement and Savings tab. To calculate or model the value at a different retirement age or to get more retirement information, please visit the Pension Information site (link under External Resources) or http://resources.hewitt.com/abbott.
- Employer match
- An employer match is in addition to your annual contributions. Abbott matches 5% of your annual salary as long as you contribute at least 2% of your pay.
For example, let's assume you earn $100,000 per year and contribute 10%. The results would be:
- $10,000 from you
- $5,000 from Abbot (which is 5% of $100,000).
- Total: $15,000
Please read the definition for "Employer maximum" for a detailed description of maximum employer matching contributions. It is also important to note employer contributions do not affect the maximum amount allowed to be contributed by an employee.
- Employer maximum
- This is the maximum percent of your salary matched by your employer regardless of the amount you decide to contribute. For example, Abbott's employer contribution or match is 5% of your pay. If you have an annual salary of $25,000 and contribute 6%, your annual contribution is $1500 and Abbott's company contribution is $1,250 (5%). If you increase your contribution to 10%, your annual contribution is $2500 per year. Your employer match, however, remains at $1,250 (5% of your annual salary).
The maximum company match is based on IRS limits. For 2012 the IRS limit is up to $250,000 of pay. For 2012 the maximum company match is 5% of $250,000 which is $12,500.
- Retirement Account Withdrawal
- This is the annual amount that you need to take out of your retirement account to meet your projected retirement expenses. In your first year of retirement this is calculated by taking your last year's estimated salary, times your expected percentage of income need in retirement. We then subtract any additional income you may be receiving such as Social Security, pensions and other income. Future year's expenses are increased by the entered inflation rate.
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