T. Rowe Price Retirement Calculator - Gotta Love It!

[Mysto]

I have been playing with the T. Rowe Price Retirement Calculator for the last two days. 

I was confused about the results so I set a goal of $2000 a month for 25 years at a 99% confidence and found out I need about 600K.  But the portfolio it suggested was about 15% stocks and the rest in bonds and short term.  As I went higher on stocks the probability of success fell.

O.K.  so then I go look at their retirement funds.  Retirement 2005 has a mix of 58.5% stocks.  So their funds will not be a success in their calculator.  Boy I want to buy a fund from them. :

(Edit: Moved by moderator at poster's request.)

 

[Rich_by_the_Bay]

I have been playing with the T. Rowe Price Retirement Calculator for the last two days.

I was confused about the results so I set a goal of $2000 a month for 25 years at a 99% confidence and found out I need about 600K. But the portfolio it suggested was about 15% stocks and the rest in bonds and short term. As I went higher on stocks the probability of success fell.

O.K. so then I go look at their retirement funds. Retirement 2005 has a mix of 58.5% stocks. So their funds will not be a success in their calculator.

Is that targeted retirement fund's objective and strategy to generate straight cash payments at a guaranteed rate for 25 years with 99% confidence?

 

[Mysto]

Is that targeted retirement fund's objective and strategy to generate straight cash payments at a guaranteed rate for 25 years with 99% confidence?

Of course not. (at least I don't think so ) and I hope you understand this is all in fun.

But most people buy a retirement fund to retire - that means (for most of us to)take funds over their remaining life and their calculator indicates a much lower equity mix than they actually use in their funds. If I used their calculator to determine how much I needed and then invested in their fund that amount, according to their calculator I would fail at me retirment. I find the disparity amusing / disconcerting at least.