I've been playing with my withdrawal spreadsheet. I've got it set up to do withdrawal calculations and then show me the results. I can change the start year to mimic retiring in a good vs. bad year (using historical data).
Anyway, here's the assumptions (not real data, but you'll get the drift):
Portfolio = 1,000,000
First year withdrawal = 35,000 or 3.5%
Withdrawals inflation adjusted
AA = 50%equity/50% bonds
I'm using 1929 as the retirement year. Obviously, no one hopes to retire at a similar time; but, plan for the worst, hope for the best.
This shows no problems (money lasts 35+ years) as long as the inflation assumption each year is less than ~3.5%. Increase the inflation assumption above that and the money won't last. I'm using one inflation number for the entire retirement, spreadsheet is getting unwieldy otherwise.
Firecalc shows 100% success for these inputs. Is it using the PPI/CPI for each year in the calcs?
Of course, it's reassuring that I get 100% success in FC . Scared me when I changed my inflation assumption in my spreadsheet to 4% and I'm eating Alpo at 85!
Anyway, here's the assumptions (not real data, but you'll get the drift):
Portfolio = 1,000,000
First year withdrawal = 35,000 or 3.5%
Withdrawals inflation adjusted
AA = 50%equity/50% bonds
I'm using 1929 as the retirement year. Obviously, no one hopes to retire at a similar time; but, plan for the worst, hope for the best.
This shows no problems (money lasts 35+ years) as long as the inflation assumption each year is less than ~3.5%. Increase the inflation assumption above that and the money won't last. I'm using one inflation number for the entire retirement, spreadsheet is getting unwieldy otherwise.
Firecalc shows 100% success for these inputs. Is it using the PPI/CPI for each year in the calcs?
Of course, it's reassuring that I get 100% success in FC . Scared me when I changed my inflation assumption in my spreadsheet to 4% and I'm eating Alpo at 85!