Armed Polite Society
Main Forums => The Roundtable => Topic started by: Ben on March 06, 2017, 10:57:31 AM
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I don't think I have ever mentioned this retirement calculator before, but thought it would be of interest to many of you. It's one of the best that I've seen. It's called FIRECalc. It's kind of designed for planning an earlier retirement, to see what variables would let you get out early. It works for any kind of "how long will my money last?" stuff though. It runs through tons of iterations, then graphs them and indicates the percent chance of achieving your goal while also letting you know how many iterations failed.
The default calculator uses basic parameters, like 60/40 mixes, 4% rule, etc. If you check out some of the other tabs though, you can change parameters, algorithms, etc. and also add other income sources (like SS or pensions) with specific future starting dates.
Anyway, I've found it to be a good and helpful calculator.
http://firecalc.com/
Edit: oh yeah, the results open in a new browser tab.
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Fantastic way of looking at it. But, it sucks for young people, and I can't imagine why. It only shows 30 years of results no matter what. For example, I have 20 more years of working, which means it only shows results 10 years into retirement. Still neat though.
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You can change the amounts and years
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You can change the amounts and years
Yes, but you only get 30 years of results, period. You can program in a number of years to save before retirement, but it doesn't add that number of years to the results, it just removes that number of years from the end. I would be interested to know what strategy results in the most money both in the 20 years until I retire, and then after I retire. I have to do the analysis at least twice. Even though it has nice tools to track impact of changing your investments after retirement, I can't really use them because of the fixed 30-year results span. I can get results of 10 years of savings and 20 years of retirement, or vice-versa, but that's sort of pointless unless I plan to die early.
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Yes, but you only get 30 years of results, period. You can program in a number of years to save before retirement, but it doesn't add that number of years to the results, it just removes that number of years from the end. I would be interested to know what strategy results in the most money both in the 20 years until I retire, and then after I retire. I have to do the analysis at least twice. Even though it has nice tools to track impact of changing your investments after retirement, I can't really use them because of the fixed 30-year results span. I can get results of 10 years of savings and 20 years of retirement, or vice-versa, but that's sort of pointless unless I plan to die early.
I'm confused re: what you're trying to do? I just ran it with a 40 year period and it graphs all 40 years on the X axis.
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Maybe I am doing it wrong
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Maybe I am doing it wrong
Maybe you are, I just tried it with 45 years, and it's working for me.
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So, it looks like, if you use the 4% withdrawal rate and you use their default assumptions, they predict about a 95% chance, over a 30 year period at least, that you'll not run out of money.
Using my general mix of types of securities, and assuming my pension and SS are still around, and giving myself quite the pay raise in retirement rather than just making up the deficit on expenses after pension and SS, I'd be increasing my net worth every year in retirement, even if I don't add hardly anything more until I'm 65. And that was the lowest line.
That is a nice feeling.
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So this came up in an email from Blueprint annuities today:
https://www.blueprintincome.com/resources/retirement-101/retirement-planning/can-i-retire/
Click on the 'can I retire tool' link at the bottom. You can then download an Excel spreadsheet and input your data.
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Maybe I am doing it wrong
Maybe it's trying to tell you something. =D
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So this came up in an email from Blueprint annuities today:
https://www.blueprintincome.com/resources/retirement-101/retirement-planning/can-i-retire/
Click on the 'can I retire tool' link at the bottom. You can then download an Excel spreadsheet and input your data.
You need to have a subscription to use that tool.
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I just checked again, and the spreadsheet downloaded and ran for me. Huh.
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I just checked again, and the spreadsheet downloaded and ran for me. Huh.
Me too.
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Ok. I'll try on a different 'puter.
Speaking of financial spreadsheets, you may be excited about this competition:
https://www.pcworld.com/article/559001/the-future-of-esports-is-microsoft-excel-and-its-on-espn.html
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Figured it out. I do need a subscription... to MS Office. Screw those guys. Got it open without paying MS anything.
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It may be time to run that calculator again, given inflation and the market going down. My portfolio is currently down about $ 100 K, which represents about four years of my planned withdrawal rate. This is a perfect setup for sequence of returns risk when I retire. I do have about three years of living expenses in cash so I can minimize portfolio withdrawals if need be while waiting for the market to recover. Or I can go back to work if I retire next year.
https://www.seattletimes.com/nation-world/millions-retired-early-during-the-pandemic-many-are-now-returning-to-work-new-data-shows/
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What? People are returning to work? I thought everyone was canceling work because evil capitalism!
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People returning to work either didn’t accurately forecast their spending (current inflation should be a very minor factor in that) or didn’t hedge enough for market drops within a the first few years of retirement with higher starting balances. IMHO if you don’t see at least 90% of scenarios with your money outliving you you don’t have enough saved. And that’s with shaving at least a point (maybe 2) off your historical rates of return too.
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IMHO if you don’t see at least 90% of scenarios with your money outliving you you don’t have enough saved. And that’s with shaving at least a point (maybe 2) off your historical rates of return too.
Because I'm a scaredy cat, I used 100% success rate and living until 95 with the inputs I used for Firecalc before I retired. I'm still making more money than I spend, so the market can go down pretty far before I get worried, especially if I temporarily eliminate my allotted luxury spending.
Millcreek - what are your scenarios showing? I think Firecalc (and most good calculators) expect there will be years that you may have to dip into principle (or scrimp a little on your spending) but calculate that you will make all or most of that money back.
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Millcreek - what are your scenarios showing? I think Firecalc (and most good calculators) expect there will be years that you may have to dip into principle (or scrimp a little on your spending) but calculate that you will make all or most of that money back.
Between my wife and my portfolios, I still think we will be just fine but it is nonetheless disconcerting to see the market dump at this time. I am still planning on retiring at probably this time next year, so we will see what the market is like then. Since so much of my retirement is dependent on market returns even with a conservative 60/40 portfolio, I kind of live and die by what the market is doing. Sequence of returns risk can put a permanent crimp in the portfolio recovery. When both stocks and bonds are dumping, it makes me grit my teeth a bit. The majority of my wife's retirement will be SS and her state pension.
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all of my scenarios show me visiting you guys in the middle of the night with a mask and a gun...
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all of my scenarios show me visiting you guys in the middle of the night with a mask and a gun...
Mine show me visiting you after you do all the work.
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Nah, you'll have caught da 'rona on one of your 10 minute from my door to the parking lot trips to WallyWorld won't be around...
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Nah, you'll have caught da 'rona on one of your 10 minute from my door to the parking lot trips to WallyWorld won't be around...
Fooled you, already caught the da 'rona.
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But you ain't caught the Super 'Rona....