 Quote:
Originally Posted by bizlady
Hypotetically, if I budget $50,000 a year in expenses, and set inflation at 3.5%--
then does the plan assume I would withdraw
$50000 in ACTUAL DOLLARS year 1
$51750 year 2
$53561.25 year 3 etc??
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Correct, where "actual" dollars are nominal dollars.
Quote:
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When a new year pops up, the planner says $50000 again, so that is what is confusing me.....
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Presumably they are using "real" (inflation-adjusted) dollars. Your "real" withdrawal stays fixed, but your "nominal" withdrawal is adjusted for inflation.
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"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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