Fidelity RIP tool

[Done]

Every now and then instead of the retirement preparedness measure wheel I get a line graph indicating what my anticipated monthly spend could potentially be in an under performing market and in an average market. For some reason I can't make this chart show up on purpose.

Anyone else get this monthly spend chart?

The income/expense bar graph is under 'Review Your Analysis'. In fact, the only way I can see the Retirement Preparedness Measure is by selecting both spouses 'Still Working' in the retirement profile Time Horizon. If either spouse is already retired, the preparedness score goes away. Makes sense.

 

[retire2020]

New change to the tool. Fidelity reduced the healthcare inflation assumption from 7% to 5.5%. My retirement preparedness score went from 104 to 111 on this change.

Where do I find preparedness score in RIP? I've run few times but it always tells whether I will meet my goal and what's shortfall/excess fund at end of the plan.

EDIT: Found it - I am at 99. I had already put 'retired' in my analysis. Score is only given for future retirement date.

 

[dand76]

From what I have seen, the 'Adjust to future dollars' option does cause income to adjust with inflation throughout retirement. Selecting this shows income flat across the Retirement Analysis bar chart when viewed in today's dollars (retaining its value over time by keeping pace with inflation), or increasing when viewed in future dollars. Unselecting the option shows the income decreasing when viewed in today's dollars (becoming less valuable) or flat when viewed in future dollars. You can change the view of the Retirement Analysis chart using the settings gear.

Thanks for the info. Looks like the Adjust to future dollars option does an annual increase of 2.4%. I'm expecting my pension cola to be around 1.5% so I think I'll leave that option unchecked and err to the safe side in my planning.

 

[tdv2]

Where do I find preparedness score in RIP? I've run few times but it always tells whether I will meet my goal and what's shortfall/excess fund at end of the plan.

EDIT: Found it - I am at 99. I had already put 'retired' in my analysis. Score is only given for future retirement date.

That's exactly it. If you have already retired checked, it no longer gives you the preparedness score.

 

[mathjak107]

i wish the default worst case at 90% could be made higher . i prefer to test at 100 % in these times .

 

[mathjak107]

By coincidence, I just ran five different calculators the other day, including the new version of Fidelity's RIP. My results were as follows:

Fidelity RIP and ESPlanner were almost identical, both being the most conservative.

******** just slightly less conservative, giving me a spending rate about 1% higher.

FIRECalc still less conservative, at 5% higher.

ORP still less conservative, at over 7% higher.

Since even the most conservative RIP and ESP calculators give me an acceptable spending rate which is 15% higher than my actual budget, I feel comfortable in the occasional splurge.

i would think that firecalc would be a bit less conservative then fidelity's rip for two reasons .

fidelity's monte carlo's attempt to find worse cases then actually happened and the auto inflation adjusting of healthcare and long term care expenses at more then 2x the average . .

while fidelity's poor market scenario is only 90% and i wish we had options on that we really can't compare fidelity's 90% to firecalcs 95% because of the difference in data sets .

 

[Frankie1926]

My end of plan increased 500,000 after this change for poor market scenario.


Sent from my iPhone using Early Retirement Forum

 

[Live And Learn]

Wow, I may need to stop being so frugal !

 

[Steelart99]

When I first started putting in expected expenses, there were default values for Medicare costs. With all my messing around, I lost those defaults. What do most people put in for those costs? ... I know there are various 'parts' to consider.

 

[tdv2]

My end of plan increased 500,000 after this change for poor market scenario.


Sent from my iPhone using Early Retirement Forum

My poor market end plan changed by about the same amount....$500k I am using a spending of $13k / month with a start date at the end of 2016...right now getting 109 RPM score. I will be 53 at year end.

 

[mathjak107]

When I first started putting in expected expenses, there were default values for Medicare costs. With all my messing around, I lost those defaults. What do most people put in for those costs? ... I know there are various 'parts' to consider.

we use 11,000 for us as a couple for medicare and an f-plan supplement

 

[ohillary]

I have used FRIP for a while but still don't understand the laweresque doublespeak of their explanation of average vs underperforming markets:

"An underperforming market is defined as the 90% confidence level of estimated future balances and/or estimated future income. The 90% confidence level represents "underperforming market conditions" with 10% of all hypothetical scenarios tested performing worse. This means that in 9 out of 10 market scenarios tested a hypothetical portfolio similar to yours performed at least as well as the results shown and 1 out of 10 performed worse than the results shown. An average market is defined as the 50% confidence level of estimated future income. The 50% confidence level represents "average market conditions" with 50% of all hypothetical scenarios tested performing worse. This means that in 5 out of 10 market scenarios tested a hypothetical portfolio similar to yours performed at least as well as the results shown and 5 out of 10 performed worse than the results shown. For more details review the Methodology."

Can anyone translate this into English?
thanks

 

[COcheesehead]

I have used FRIP for a while but still don't understand the laweresque doublespeak of their explanation of average vs underperforming markets:

"An underperforming market is defined as the 90% confidence level of estimated future balances and/or estimated future income. The 90% confidence level represents "underperforming market conditions" with 10% of all hypothetical scenarios tested performing worse. This means that in 9 out of 10 market scenarios tested a hypothetical portfolio similar to yours performed at least as well as the results shown and 1 out of 10 performed worse than the results shown. An average market is defined as the 50% confidence level of estimated future income. The 50% confidence level represents "average market conditions" with 50% of all hypothetical scenarios tested performing worse. This means that in 5 out of 10 market scenarios tested a hypothetical portfolio similar to yours performed at least as well as the results shown and 5 out of 10 performed worse than the results shown. For more details review the Methodology."

Can anyone translate this into English?
thanks

One gives you a 90% confidence level and the other gives you a 50% confidence level when run through a Monte Carlo type analysis.

 

[wmc1000]

or stated another way -

you have a 50% chance of ending up with the higher amount of dollars with average market conditions

you have a 90% chance of ending up with no less than the lower dollar amount with under performing market conditions over the rest of your lifetime.

 

[ohillary]

sounds like 2 variables per condition, without the condition defined.
where is the 50% chance in and underperforming market? or the 90% chance in an average market?
does it mean that out of all monte carlo simulations (it says it runs 250 of em) that it only takes 10?
-

"This means that in 9 out of 10 market scenarios tested a hypothetical portfolio similar to yours performed at least as well as the results shown and 1 out of 10 performed worse than the results shown."

an average?
sorry to be obtuse
thanks

 

[Options]

When I first started putting in expected expenses, there were default values for Medicare costs. With all my messing around, I lost those defaults. What do most people put in for those costs? ... I know there are various 'parts' to consider.

I'm less than 5 years from Medicare, so I got the Medicare for Dummies book and, following the process they outlined, used Medicare.gov to compare costs as if I was going on Medicare today. This gave me an idea of my healthcare outlay. It's a lot easier for me as I have decided to use an MA plan. All aspects of MA plans, including costs and benefits (as well as prescription drug and ancillary benefits), can be compared directly on the Medicare.gov site.

If you plan to use traditional Medicare with a Medigap plan, separate Part D plan costs, limitations, and exclusions can be compared directly on the site. As I understand it, the only way to compare Medigap plans is to contact each insurer directly.

 

[COcheesehead]

sounds like 2 variables per condition, without the condition defined.
where is the 50% chance in and underperforming market? or the 90% chance in an average market?
does it mean that out of all monte carlo simulations (it says it runs 250 of em) that it only takes 10?
-an average?
sorry to be obtuse
thanks

At 90%, 25 markets out of the 250 run, will give you worse results.
At 50%, 125 markets out of the 250 run, will give you worse results.