BrilliantWithMoney

Unless you are a whiz at mathematics, doing the number crunching associated with your Financial Planning can be a bit of a challenge. As with most things, help is close at hand when you go online.

You can find a very wide range of financial calculators on the Internet. Many are designed for the North American market; with pricing in US dollars and the associated American tax rules applied. For the British user they are better than nothing, but they are far from perfect.

Here is a selection of our favourite online financial calculators and tools for your personal financial planning pleasure.

Pension Calculator

This tool, provided by the Financial Services Authority (FSA) and Association of British Insurers (ABI) is a really neat way of working out how much income you might receive in retirement when you save in a pension plan.

After providing basic details (such as your date of birth and sex) you simply input a series of facts about your current earnings and the type of pension income you would like to get in the future. You can also enter details of any existing pension funds, to take these into account in the overall calculation.

Once you hit the calculate button, the system tells you what total monthly income you might expect to receive at your selected retirement age. It also provides projections showing the breakdown between the income your existing and future pension contributions might produce, what might happen if you saved a bit more and what might happen if you retired a bit later.

It also produces your results in graph format, which is more user friendly than a table of numbers. All in all, a great online calculator that should help you make some important decisions about pension funding for retirement income.

Mortgage Cost Calculator

This is another online calculator from the Financial Services Authority (FSA). It allows you to work out how much your monthly mortgage repayments are likely to be. You can use this calculator to work out what size mortgage you can afford, based on different interest rates.

To use this calculator you need to enter three bits of information – the mortgage amount, the number of years left on your mortgage and the mortgage interest rate. When you press the calculate button it will show you the monthly cost on an interest-only and capital repayment basis, enabling you to compare the two options.

You can then see what would happen if interest rates changed – if rates increased by anywhere from 1% to 5%. This is a great feature for understanding the risk of future interest rate increases. With the Bank Rate at a historic low of 0.5%, interest rates will go back up at some point in the future. Thinking ahead to these future rate increases should help you to prepare for the event rather than allowing it to come as a complete surprise.

Target Savings Calculator

If you have a particular savings goal, this online calculator from the Halifax can help you work out how much you will need to save each month.

You need to enter your savings target, length of time for which you want to save and the gross interest rate you will get on your savings. There is also an option to input a lump sum to get you started towards your savings target.

Once you press calculate, it tells you how much you need to save each month to reach your savings target. It breaks down the total amount saved between your actual savings and the interest earned on these savings.

This calculator asks you to use a gross interest rate, so you might want to adjust this to take off income tax at 20% or 40% depending on your level of earnings.

Financial Protection Tool

This online tool from unbiased.co.uk asks you seven simple questions before presenting some information about the different types of protection policies you might need to consider. This information is tailored to your personal needs, based on the answers you provide, which can help you to narrow down the areas in which you need to find out more.

The information provided about the different protection options is extremely well written, comprehensive and easy to understand. This tool would be a good starting point for anyone thinking about your financial protection options.

Income Tax Calculator

This is a nice, easy to use tool from Money Saving Expert that you can use to calculate your income tax, National Insurance contributions and resulting net pay. All you need to enter is your gross income and age. When you press calculate you are shown the total income tax you will pay in the tax year, how much you will take home each year or month.

There is a neat feature to compare this to previous tax years, going back as far as 1999/2000. This is really helpful to see how your income tax costs have changed over the years. There is a full breakdown (by week, month and year) showing your gross wage, taxable wage, tax paid, tax free, National Insurance and net wage.

Tax Waste Calculator

Another tool from unbiased.co.uk, the tax waste calculator asks you up to 16 simple ‘yes’ or ‘no’ questions before giving you a very general figure of how much tax you could be wasting. Whilst this is a very basic tool, it should prompt you to take some action, particularly if the tax waste figure is high. By looking at the different questions being asked you should get some ideas for areas you could explore to save on tax.

Martin Bamford is site editor of BrilliantWithMoney and a Chartered Financial Planner at Informed Choice.

The small but important print: The calculators and tools mentioned, and links provided, in this post are for information only and do not constitute an endorsement of the providers or services mentioned. We can not take responsibility for any links to third-party websites.