Ever wished that your purse contained a countdown clock to the date you will be financially independent?
Ever asked yourself whether making the effort to save an additional $20/month is really worth it?
Ever tried to convince a recalcitrant spouse that buying avocado toast twice a week really is going to add up?
The Pretirement App (available in both the Apple and Android app stores) aims to fulfill these very desires.
This article is a review of the Apple version of the app. Mr. BITA tried out the Android version and confirmed that it offers the same features.
When you first launch the app, it greets you with this question:
Clicking on the ‘Get Started’ button takes you through a few screens where you enter some basic information. All information used by this app is entered manually – it doesn’t link to any of your financial accounts. It also does not require you to create an account, and I give it bonus points for just letting you get right to it.
You can pay $4.99 for a Ad-free version of Pretirement.
When you hit submit, it shows you a countdown clock to your financial independence date.
The screen also shows you your current assets. The assets keep incrementing automatically based on the ROI and savings rate you specified, just as the clock keeps counting down.
My guess is that the date isn’t based on Monte Carlo simulations or anything remotely fancy. It probably just uses a simple NPER style function to spit out these values.
The ‘Save’ and ‘Spend’ buttons allow you to see the effect on your date if you are either a good ant or a naughty grasshopper.
You can enter an amount to save or spend, and the frequency with with you intend for the money to enter or leave your wallet. The app crunches the numbers and shows you something like this:
The ‘Plot’ button shows you this same information via a very simple graph.
What is Pretirement good for?
Pretirement is clearly not a serious retirement planning app. It is a toy, and should be treated as such, but it is a toy that can be both fun and useful. The interface is simple and minimalistic, an aesthetic that appeals to me.
The countdown clock (and the constant asset updates) are fun to watch. Well, they are fun to watch in a bull market. In a bear market watching your theoretical assets climb while your actual Stash shrinks would probably be incredibly annoying.
I think the more useful part of this app is the fact that it gives you a quick and dirty way to visualize the effect of both spending and saving. Imagine that you are roaming the aisles of Target and are overwhelmed with the urge to procure those purple polka dotted shorts that are cute beyond belief. You could wrestle with your baser self and hope to emerge triumphant. Or you could pull out the app, enter the amount your are planning to spend, watch your retirement date fade into the distance and be easily convinced that there are no shorts in this universe that are cute enough for that.
Or maybe you are the financial geek of the family, but your spouse would rather swallow a cactus than deal with numbers on a daily basis. Pretirement could be the way to avoid repeated conversations about the ‘true’ cost of purchases. When either of you gets a raise or bonus, Pretirement gives you a quick way to know just how much celebration your newly earned moolah deserves
Our brains have a tough time visualizing the effect of compounding at the best of times, and when one is weak in the knees with temptation, the siren call of immediate gratification makes it even easier to ignore compounding and say “But it is only $40!” Think of Pretirement as the friend in your pocket that gives you a nice cold shower just when you need it most.