You’ve probably seen retirement calculators scattered all over the Internet. Almost every bank and brokerage firm has their own. You can also find them at sites like CNN Money or MSN Money. With so many available, you’d think that everyone would know their “number” that they’ll need to retire. The thing is, even with this many calculators out there, many people still don’t have any idea what they will need to retire. Partly that’s because some people are afraid to look, and partly it’s because all of the different calculators give you different numbers. For giggles, I used three calculators. The one from CNN Money tells me I’ll need $778,000 to retire. The one from Fidelity tells me that I will need $2,511,000 and the one from Schwab tells me that I’ll need $1,777,000. That’s not a small difference. So which is it?

Figuring out what you’ll need at retirement means learning how to really understand a retirement calculator and what each one is using to come up with your numbers. For example, the CNN calculator was assuming that I will get Social Security benefits. The Fidelity calculator did not. Many calculators “assume” that the market will perform a certain way and that you will gain a certain average return per year. Some assume six percent, some assume seven percent and others assume eight or more. Some allow you to specify the market return you think you’ll get. A few percentage points either way can make a big difference. Some assume that you will get a raise each year and be able to increase your contributions, while others assume a stagnant income and contributions that remain level. All of these assumptions make a big difference to your number.

Further complicating things is the amount of money each calculator thinks that you will need in retirement. Some use a set percentage of your current income or it lets you enter the percentage you think you’ll need. Some calculators give you a fixed annual amount of money rather than a percentage. Some calculators adjust for inflation and others don’t. Still others try to account for the tax bracket that you will be in at retirement and further adjust your number to account for that. By the time the calculators are done assuming and guesstimating, you’ve got numbers that range all over the place.

If you want to get an accurate idea of what you will need in retirement, here is how to get the best information from retirement calculators.

**Use several different calculators**: I’m sure your bank would prefer that you stick with theirs, but put your data into several to get a feeling for what you’ll need with or without Social Security, whether your numbers are coming out close together or far apart, and what each one is telling you about your chances of getting where it thinks you need to be. After a few calculators you’ll probably start to see that you’re getting a more consistent “average” or middle number, with a few on the extremes at either end. The numbers that come in closest together probably give you the best representation of where you need to be.

**Pay close attention to the questions you are being asked**: You’ll start to see that some automatically fill in certain blanks for you and others make you figure the number. Some let you choose from a set list of options. Keep a sheet of paper handy and jot down what each one asks for and what each one is assuming. Once you’ve got several numbers from different calculators you can go back and look at how each one arrived at that number.

**Pay close attention to the assumptions being made**: Are your calculators assuming that you need seventy percent of your income, or eighty? Are they assuming that you will get an eight percent market return, or five percent? These assumptions make a huge difference in your total number, so don’t you assume that they are all using the same numbers. To get a good comparison, try to find some calculators that use the same assumptions and then compare them to ones that use drastically different numbers. Many calculators explain their methodology and assumptions in the fine print. Look for a link near the bottom or off to the side of the page that says something like, “How we calculate your retirement,” or “Methodology.” This will clue you in as to how they’re figuring your numbers.

**Play with your numbers**: Take a look at what happens if you put off retirement for an extra three years or if you move it up two years. See what happens if you save an extra $1,000 per year, or if your contributions drop by $2,000 per year. See what happens if your income increases or decreases. You’ll start to see how much control you have over your retirement picture and how your actions can change the picture.

The bottom line is that you can’t just look at one calculator and say, “Okay, that’s my number.” You have to use several different calculators and try to make comparisons amongst numbers and assumptions that are not equal. You have to take the initiative and be the one to figure out how each calculator is coming up with the numbers. You have to be the one to look for similarities and differences and then look for the average that probably closest represents your number. Of course, you want to save as much as possible, regardless of what the calculator says. A margin for error never hurts.