So you get 100% in Firecalc .. but are you comfy with your lowest minimum balance ?

[corn18]

There's nothing like a good illness to ease your mind off SORR.

And I am not talking about something like what residents of Wuhan are going through. They are worrying about something much more immediate than SORR.

Life can get exciting, even for people who do not look for trouble.

I hear ya. I got laryngitis on New Year's Day. Went to the doc and got antibiotics. Then steroids. After 4 weeks I went to the ENT. 30 minutes after I got there I was in the hospital getting CAT scans of my head, neck and lungs because he said I had a 50% chance of having lung cancer. Turns out it was not cancer (paralyzed left vocal cord, which still isn't good), but holy hell, that was a rough 24 hours. Did a lot of what if's in the retirement spreadsheet that night waiting for the results from the scan.

 

[ncbill]

There are plenty of retirement calculators that allow you to specify a minimum ending portfolio value...MaxiFi is the one I use.

The Engaging Data calculator also puts things in perspective...for me ~1/3 chance of being dead @ 75...rising to ~2/3 chance of being dead @ age 85.

 

[corn18]

The Engaging Data calculator also puts things in perspective...for me ~1/3 chance of being dead @ 75...rising to ~2/3 chance of being dead @ age 85.

That certainly drawfs the 1% chance of being broke. Although being broke sucks, I am much more likely to be dead. And I can adjust spending to avoid broke. Not much I can do about being dead (although I did quit smoking so that should help).

 

[Mdlerth]

Bring on the Dom Perignon?

I am a fan of this estimator. You have to make some assumptions but it does give one an idea as to how much one can withdraw. Our recommended rate turns out to be exactly 4 x what we really need to maintain a good standard of living.

https://www.money-zine.com/calculators/retirement-calculators/retirement-withdrawal-calculator/

I just ran that one and it's WAY more generous than FIRECalc. I planned on 100% in FIRECalc plus a bit of cushion, but the money-zine calculator gives me even more. Not that I'm going to change anything in my lifestyle, but it's another bit of reassurance. Now that I'm officially unemployed, I like reassurance.

 

[MarieL]

I don't see a lot of orange in your future:

https://engaging-data.com/will-money-last-retire-early/?spend=25000&initsav=750000&age=30&yrs=60&stockpct=60&bondpct=40&cashpct=0&sex=0&infl=1&taxrate=0&fees=0.01&income=0&incstart=50&incend=70&expense=0&expstart=50&expend=70&showdeath=1&showlow=1&show2x=1&show5x=1&flexpct=0

So (at least) $750k is the number I should be aiming for right now?

 

[GalaxyBoy]

Sorry I don’t have a number for the OP, there are too many variables to suggest a meaningful answer anyway.

...

And what someone else chooses wouldn’t inform our decision anyway, we’re mostly anonymous strangers here.

Like all retirement spending calculators, FIRECALC is an axe, not a scalpel.

This, +1. It seems many folks look at the results as an exact forecast. I ran a variety of computer models, FireCalc, Fido RIP, crowdsourced whateveritscalled, I-ORP, etc. before I made a decision. But eventually you just jump out of the plane, pull the rip cord and yell, “Geronimo!”

 

[Dtail]

So I use %remaining portfolio, which can’t run out of money because you take out a fixed percentage of the portfolio value each year. If the portfolio shrinks, so does your income. You don’t get stuck in a scenario of withdrawing larger percentages of the portfolio year after year.

But I did look at remaining portfolio for various withdrawal rates. Mostly 30 year, but I ran a few longer - 40 years.

I modeled a 50/50 total stock market/5 year treasuries portfolio with various withdrawal percentages in FIREcalc.

Withdrawing 4.35% of the portfolio value each year resulted in an average remaining inflation adjusted portfolio of 100% of the original on average, and 50% in the worst case. So worst case you’d be down to half of where you started, adjusted for inflation.

For 40 years - results were about the same.

4.35% appeared to be a generally self-sustaining withdrawal rate.

Note that I’m not talking about the traditional method here.

Bolded by me - but wonder how many folks on this site are withdrawing 4.35% each year. Probably very few.

 

[foxfirev5]

Personally I wouldn't split hairs over past returns. Take a look at what your portfolio is yielding with cap gains and build in a cushion. Old school but it still works.

 

[Midpack]

There are plenty of retirement calculators that allow you to specify a minimum ending portfolio value...MaxiFi is the one I use.

The Engaging Data calculator also puts things in perspective...for me ~1/3 chance of being dead @ 75...rising to ~2/3 chance of being dead @ age 85.

So does FIRECALC on the Investigative tab...

 

[NW-Bound]

I hear ya. I got laryngitis on New Year's Day. Went to the doc and got antibiotics. Then steroids. After 4 weeks I went to the ENT. 30 minutes after I got there I was in the hospital getting CAT scans of my head, neck and lungs because he said I had a 50% chance of having lung cancer. Turns out it was not cancer (paralyzed left vocal cord, which still isn't good), but holy hell, that was a rough 24 hours. Did a lot of what if's in the retirement spreadsheet that night waiting for the results from the scan.

For most of us, the risk of death in 30 years is a lot higher than the risk of being broke. At least, that's for people on this forum, or anyone who even understands what WR means, and what his own number is.

I have stopped worrying about being broke, particularly as I made it to SS eligibility age to have it as a backstop. That frees my time, so I can surf the Web looking for travel info or for coronavirus development, depending on whatever suits my fancy at the moment.

PS. But back on the OP's question, yes, having your stash halved or quartered is no fun, even if you do not plan to spend it all. Yet, it may happen and we just have to live with that possibility. We should consider ourselves lucky if we make it to 80 without getting the big C, or heart attack, or stroke, or a stray virus.

 

[GenXguy]

Just wondering, you run Firecalc, and you get 100% say over 40 years.
What minimum balance are you comfortable with ? $300K left, $500K left ? $1 Million left ?

$0 left as long as it's about 100% successful.

However, over half of my spending is for discretionary spending, so I can cut back if needed.

 

[pb4uski]

Just wondering, you run Firecalc, and you get 100% say over 40 years.
What minimum balance are you comfortable with ? $300K left, $500K left ? $1 Million left ?

If you get 100% with FIRECalc then there will only be a few scenarios anywhere close to zero.... most will be at a lot more than zero.... so zero would be fine with me... I fact, I wouldn't necessarily need 100%... IMO 98% or 95% is probably fine.

 

[FREE866]

I don't see a lot of orange in your future:

https://engaging-data.com/will-mone...death=1&showlow=1&show2x=1&show5x=1&flexpct=0

that site is so awful
so much clickbait
i'll stick with firecalc

 

[USGrant1962]

that site is so awful
so much clickbait
i'll stick with firecalc

I'm not following you? I don't see any "clickbait". Just another retirement calculator (JATC), with a really interesting spin.

 

[Out_the_Door]

I work up all my numbers with a remaining portfolio of one dollar. I'm single with no kids so leaving a legacy is not a concern but on the other hand a remaining portfolio of one dollar has me spending two and a half times my yearly expenses which is more than I would want to spend on "crap"

 

[cyber888]

Thanks guys ... I guess we all want to have some buffer .. like what if some of us live like Kirk Douglas to 103 years old instead of 80, 90 or 95.

 

[Perryinva]

I don’t see us ever spending each year all of the amount FIRECALC says at even 95% success rate. But for belt & suspender purposes I usually put in $200k. And if I see our balances taking one of the stratospheric paths, I can always invest in Porsches....

 

[cyber888]

$0 left as long as it's about 100% successful.

However, over half of my spending is for discretionary spending, so I can cut back if needed.

I suppose this makes me feel better about having $200,000 left after 40 years I probably will be in another dimension by then.

 

[Lawrencewendall]

I don't see a lot of orange in your future:

https://engaging-data.com/will-money-last-retire-early/?spend=25000&initsav=750000&age=30&yrs=60&stockpct=60&bondpct=40&cashpct=0&sex=0&infl=1&taxrate=0&fees=0.01&income=0&incstart=50&incend=70&expense=0&expstart=50&expend=70&showdeath=1&showlow=1&show2x=1&show5x=1&flexpct=0

It says I'll be dead before I'm broke so I got that going for me.

 

[EastWest Gal]

FireCalc gives me 100% success on our spending rate with a cushion of an extra $40K per year, not including Social Security. When I include Social Security, my lowest balance is right now. Maybe I should read the Blow That Dough! thread.

 

[corn18]

FireCalc gives me 100% success on our spending rate with a cushion of an extra $40K per year, not including Social Security. When I include Social Security, my lowest balance is right now. Maybe I should read the Blow That Dough! thread.

I hope you are retired!

 

[Dtail]

FireCalc gives me 100% success on our spending rate with a cushion of an extra $40K per year, not including Social Security. When I include Social Security, my lowest balance is right now. Maybe I should read the Blow That Dough! thread.

Actually your lowest balance is probably even higher, as Firecalc will never show the lowest balance to be higher than your current balance.
Just a quirk.

 

[W2R]

I usually tell FIRECalc to never let my balance drop below $400K.

 

[PoorOldCountryBoy]

Just wondering, you run Firecalc, and you get 100% say over 40 years.
What minimum balance are you comfortable with ? $300K left, $500K left ? $1 Million left ?

I would consider the 100% number to be a starting point. You're not getting THE answer from Firecalc, just a reasonable guess. If your life is in a bad state and you need to make a change, you can. If you can trudge and do the one-more-year march of the ER penguins, you may choose to do so.

To invoke another movie reference: "Choose Wisely".

 

[pb4uski]

While it is easy to say because we are at 100%, I would be a-ok with 95%. If you look at the graph of lines at 95%, there are less than a handful of failures and the failures are all in the last few years of the projection period... one after 23, 24, 25 and 29 years, respectively..... and once you factor in the liklihood of living to the point of failure the likelihood of failure is infintesimal.

So if you retire at 60 with 95% success/5% failure with the first failure is at 23 years and the probability of a 60 year old living to 83 is 50%, then the real failure rate is more like 2.5% rather than 5%. Presumably if one was headed towards failure there are actions that they could take to avoid it... the smallest failure is negligible, then three that are $150-300k.