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Old 08-04-2014, 03:23 PM   #21
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Firecalc does not account for taxes so you must include it in your spending amount. Many other calculators account for the taxes but Firecalc does not. So I think that if you need after tax of (for example) $50,000 then you would make your spending higher - estimating what your before the tax amount would be.

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Old 08-04-2014, 03:24 PM   #22
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Originally Posted by wfobrien View Post
just to clarify my spend in Firecalc is post tax $s?
FIRECalc assumes you include taxes as part of your spending projections.

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Old 08-04-2014, 03:25 PM   #23
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Originally Posted by wfobrien View Post
just to clarify my spend in Firecalc is post tax $s?
Your annual spend (expenses) in FIRECalc should include the amount you expect to pay in taxes each year (your tax expense). Here's a short thread with answers to that question from Dory36, the guy who wrote FIREcalc:

Does FIRECalc figure taxes?
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Old 08-04-2014, 05:19 PM   #24
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Originally Posted by wfobrien View Post
I was thinking of the annuity as a way to hedge against a huge hit to my portfolio-since other than SS its all I got.
Try this exercise: Divide the cost of the annuity (SPIA, right?) by the amount it pays you each year, and see how many years it takes until you're getting their money instead of just a return of your money.

I read one recently where a 68 year-old lady was recommended to buy a SPIA, and when you did this it turned out that she was just getting her own money back for the first 18 years. Only if she lived several years past her life expectancy would she finally be getting their money.

She'd be much better off by putting it into a bond fund like DODIX and taking the same monthly withdrawal.
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Old 08-04-2014, 06:10 PM   #25
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Yeah thats what I got....but at 62...that means if I live to 90....hmmm a lot of ifs there
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Old 08-04-2014, 09:27 PM   #26
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Originally Posted by wfobrien View Post
Yeah thats what I got....but at 62...that means if I live to 90....hmmm a lot of ifs there
The next step is to assume an investment rate of return for the money you put into the annuity. That lengthens the time it takes for the annuity payments to pay off. It really doesn't take much investment return to fund the annuity.

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