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Old 05-16-2017, 08:55 AM   #1
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Income/Spending Tab

Questions:

1. On the start tab, the spending portion: I can only assume this is asking what I want to spend annually correct? If so, then when I put in 110K spending with a portfolio of 525K it give me 100% for all the spending models. This maybe because I entered our guaranteed income of 79K after tax not counting my SS at 62 (now 57) or my other small pension of 7K. Does that make sense, or am I missing something?

2. On the Income and spending tab there are only 3 lines for input (goes to my point on line #1 above), and I have a few more pension checks coming in at certain intervals. (A good thing), however to get a better true assessment on if/when I can walk away, it would be nice to enter? Also, I am putting in after tax numbers so I can be a little more conservative

3. Lastly, is there a specific ROR or a burn rate FIRECALC uses for these scenarios?

Thanks so much and looking forward to your wisdom
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Old 05-16-2017, 11:05 AM   #2
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1. Yes, the numbers are annual rates. Doing the math, 110K - 79K - 7K = 24K, which is about a 4.57% withdrawal rate on your 525K. That seems like it is high enough that it should fail sometimes, particularly for longer periods of time with low stock allocations. Not knowing what you're using for the time period and equity allocations, it is possible that you're seeing 100% success.

2. I think people who support FIREcalc with a small donation can get access to more input lines. You can also try out ******** which is a similar calculator which has more input lines.

3. FIREcalc is most often used as a historical calculator, which means it uses historical rates of return and sees how you would fare if you had retired in the past. There is a "random" option on the portfolio page if you want to do a Monte Carlo analysis. Not sure what you mean by "burn rate", but if you use the default configuration, it will take your spending and increase it by historical inflation every year, subtracting that amount from your portfolio, which it increases by historical market returns applied to the asset allocation of your portfolio.

Hope that helps.
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Old 05-16-2017, 11:31 AM   #3
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Quote:
Originally Posted by SecondCor521 View Post
1. Yes, the numbers are annual rates. Doing the math, 110K - 79K - 7K = 24K, which is about a 4.57% withdrawal rate on your 525K. That seems like it is high enough that it should fail sometimes, particularly for longer periods of time with low stock allocations. Not knowing what you're using for the time period and equity allocations, it is possible that you're seeing 100% success.

2. I think people who support FIREcalc with a small donation can get access to more input lines. You can also try out ******** which is a similar calculator which has more input lines.

3. FIREcalc is most often used as a historical calculator, which means it uses historical rates of return and sees how you would fare if you had retired in the past. There is a "random" option on the portfolio page if you want to do a Monte Carlo analysis. Not sure what you mean by "burn rate", but if you use the default configuration, it will take your spending and increase it by historical inflation every year, subtracting that amount from your portfolio, which it increases by historical market returns applied to the asset allocation of your portfolio.

Hope that helps.
1. Yes...correct, good catch. Re-doing the math with the above numbers it would only give me a 95% success rate for 40 years. However, not adding in my SS at 62 would still give me 100% @ 40 years spending 100K annually.
To note: I kept out of calculations other fluff like 150K in another investment account, and 100K in cash . Health care should NOT be a big issue because I am retired Military. Looks like "finally" in Dec of 2018 @ 58 years old..... just maybe the year!
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