firecalc

[ratraceout]

quick question re firecalc

on the first page where you put your expenses doe the calculator factor in inflation on these? i.e if you are spending 50k today does that progressively increase depending on the inflation rate you put later on...

im assuming it does but i couldnt find it on the firecal page...

thanks

 

[REWahoo]

...if you are spending 50k today does that progressively increase depending on the inflation rate you put later on...

Yes.

From the "How It Works" page:

Since your lifestyle costs will change with inflation, the future withdrawals are adjusted accordingly...

 

[ratraceout]

thanks a lot! sorry i missed it.

 

[urn2bfree]

How does FIRECalc figure on the cost of paying taxes?

 

[Onward]

How does FIRECalc figure on the cost of paying taxes?

You have to include taxes in the desired withdrawal amount that you give to FIRECalc.

 

[urn2bfree]

So how do you figure taxes...that seems trickier...

 

[Nords]

So how do you figure taxes...that seems trickier...

Most users assume they'll be in the 15% federal income tax bracket and whatever state/county/city/local brackets seem appropriate.

You could take your retirement spending budget and apply any deductions and the exemptions before checking the tax tables, or you could use the tax-estimator feature of a variety of tax software programs. The tax software generally does a better job with interest, qualified/unqualified dividends, cap gains, and tax-free income. Of course you won't be worrying about W-2 income...

The good news is that most ERs see a huge drop in taxes compared to their working years.