Aside from Firecalc - what other 'tools' have you used to est FI?

[BBQ-Nut]

So, the 'free' version of Firecalc is just one of a couple of estimates we have done to see if our savings will last into retirement, along with SS and our pensions.

But, Firecalc doesn't seem to model taxes, or allocations of assets vs taxes (after tax, tax deferred, tax free) -and taxes weigh heavily on my mind as a significant factor for how assets are drawn down and in what allocations over time.

Nor does Firecalc model RMD and how that impacts remaining assets - as far as I know.

I have my own 'model' and that accounts for taxes, allocations, RMDs, but is static in what real return to plug in for the duration under consideration.

What other tools have you used to model your retirement?

Thanks!

 

[pb4uski]

My favorite deterministic planner is Quicken Lifetime Planner (included in Quicken Deluxe and higher). It does model RMDs as I recall but does not model income taxes. One of the inputs is a average tax rate before retirement and during retirement.

I'm not aware of any planner that includes tax calcs within though I have done that in my personal spreadsheet retirement model (as well as Roth conversions and RMDs). My AA is static (60/40) so my AA is reflected in the investment rate of return I use.

While Quicken does have separate categories for taxable, tax-deferred and tax-free, in the QLP reporting it only shows taxable and tax-deferred (which includes both tax-deferred and tax-free).

I use FireCalc principally as a stochastic check of my QLP plan.

 

[LOL!]

Fidelity Retirement Income Planner (RIP)
Otar's retirement optimizer otar retirement calculator

FIREcalc includes taxes as part of your expenses. That allows for every possible tax situation.

And don't forget www.i-orp.com and TurboTax.

 

[NanoSour]

Having ER'd 9 months ago here are my most trusted retirement calculators.

1) ESPlanner - there is a free online version, but I paid $199 for the Monte Carlo edition. It does an excellent job with tax consideration, both Federal and State, and with SS estimates. Wouldn't have pulled the plug without this calculator.

2) Flexible Retirement Planner - Another excellent calculator that you can use online or download to your computer and it's free. Does include Monte Carlo simulation and considers user controlled tax implications. Good documentation on the website.

3) Optimal Retirement Planner - This free online tool does consider Federal taxes and also provides a suggested Roth conversion strategy.

4) FireCALC - A good calculator for an initial look at you situation, but not having taxes built in is somewhat limiting.

All of these calculators take considerable time to learn how to use and understand their outputs. However, the time invested in them is well worth it and I never would have pulled the plug without them.

 

[Fermion]

My wife is a very experienced software engineer. One of the things I may try to convince her to do when we ER is write a comprehensive early retirement calculator that does tax planning, rollovers/conversions, ACA subsidies, state choice and portfolio predictions all in one easy to use interface. I would work on the calculations but have her do the coding since she is 1000x faster.

Or maybe we will just hike and fish.

 

[Independent]

I have my own spreadsheets. One is focused mainly on withdrawal rates and investment returns. The other focuses on taxes, recognizing RMDs.

 

[Willers]

I use:

1) ***** - like FireCalc with some additional options, Crowdsourced Financial Independence and Early Retirement Simulator/Calculator
2) QLP
3) i-orp

So far they all have good things to say about our plan and hoping that continues.

 

[Lsbcal]

First FIRECalc has a bug. For bonds it does not do things quite right, see: http://www.early-retirement.org/forums/f36/firecalc-accuracy-and-future-69980.html

So if you have a bond heavy portfolio I'd be wary.

For most planning nowadays, I use my own spreadsheet. I could detail the column headings if someone wants it. It is one line per year going out maybe 20 years forward but continually updated too.

P.S. With all this retirement info we are providing, are we invited to a BBQ sometime?

 

[REWahoo]

First FIRECalc has a bug. For bonds it does not do things quite right, see: http://www.early-retirement.org/forums/f36/firecalc-accuracy-and-future-69980.html

Some see it a bit differently, but still noteworthy:

I don't see this as a flaw, more like an incomplete aspect, but still important for those of us using it to model portfolio behaviour.

I'm not aware of any retirement calculator that incorporates fluctuations in bond values. From the thread linked above, it wasn't included in the famous Trinity Study.

 

[foxfirev5]

I take a conservative approach with Firecalc and Fidelity RIP. The biggest challenge I see projecting future expenses, particularly healthcare. At some point there will just have to be a leap of faith and take the plunge.

 

[scrabbler1]

As a Fido customer, I have used their RIP program over the years to project expenses and investment income, especially beyond the age of 65. Using what I learned from seeing how it works, I made some tweaks to my existing spreadsheets which project out to age 65. The biggest tweak was to assign separate inflation factors to my medical expenses (i.e. health insurance) versus my non-medical expenses. That is a big one when trying to predict overall future expenses.

 

[Lsbcal]

Some see it a bit differently, but still noteworthy:

I'm not aware of any retirement calculator that incorporates fluctuations in bond values. From the thread linked above, it wasn't included in the famous Trinity Study.

What I look at is: how low can the portfolio go? Tends to test your stomach for risk. So marking to market is an important part of this.

Marking to market will give the best picture of the past. When the plane is in a nosedive, who knows what is next? Yes, the 1930's eventually corrected but in 1932 that wasn't clear.

 

[REWahoo]

When the plane is in a nosedive, who knows what is next? Yes, the 1930's eventually corrected but in 1932 that wasn't clear.

The same can be said for 2008/2009.

The bigger question is, if the plane doesn't pull out, what can you do to survive? And please don't tell me you have a "golden parachute"...

 

[chris66]

My wife is a very experienced software engineer. One of the things I may try to convince her to do when we ER is write a comprehensive early retirement calculator that does tax planning, rollovers/conversions, ACA subsidies, state choice and portfolio predictions all in one easy to use interface. I would work on the calculations but have her do the coding since she is 1000x faster.

Or maybe we will just hike and fish.

I kinda thought the same thing, including the "or maybe just..."

I use FidelityRIP, FIREcalc, and my own Excel spreadsheet. You can create modules in Excel to add pretty advanced calculations, but I've found just the formulas really got me close enough on most things, and I just haven't had time to work on it further. I suspect this is mostly because I've been developing insurance and financial software for my entire adult life so this stuff isn't fun and new enough. The spreadsheet seems good enough as it is, and other activities are more engaging for me now.

 

[Lsbcal]

The bigger question is, if the plane doesn't pull out, what can you do to survive? And please don't tell me you have a "golden parachute"...

If the plane doesn't pull out there is no plan that works. But the plane could just wind up at very low altitude. One has to use the parachute before low altitude is reached.

That parachute has gotten a bad rap -- intelligent market timing. Some would say that parachute has holes in it. My parachute is designed pretty well but who knows?

Now on to the OP's real topic ...

 

[Huston55]

As a Fido customer, I have used their RIP program over the years to project expenses and investment income, especially beyond the age of 65. Using what I learned from seeing how it works, I made some tweaks to my existing spreadsheets which project out to age 65. The biggest tweak was to assign separate inflation factors to my medical expenses (i.e. health insurance) versus my non-medical expenses. That is a big one when trying to predict overall future expenses.

Same here; I'm a FIDO customer who uses RIP. RIP does model taxes and RMDs, and it also has multiple scenarios you can evaluate and knobs you can turn (eg: inflation) to customize to your particular situation. Beyond this, the feature I like best is its ability to record and store detailed expense information, which FIRECalc cannot do.

 

[Fishingmn]

An alternative I use to calculate taxes is to use a tool that estimates state & local income taxes for me and then just use that in my budget estimates - Income Tax Calculator - Tax-Rates.org

 

[enjoyinglife102]

I use Firecalc, Vanguard's calculator and my own spreadsheet but most of all common sense and flexibility.

 

[pb4uski]

I think sometimes we need to step back a recognize that in most cases our long term retirement projections are very assumption bound. They are fine for decision analysis but actual results will vary from projected (thus far to the good side in my case but that could reverse).

Sometimes our focus on these tools reminds me of the old saying "Measure it with a micrometer, mark it with a chalk, cut it with an axe."

 

[pb4uski]

Same here; I'm a FIDO customer who uses RIP. RIP does model taxes and RMDs, and it also has multiple scenarios you can evaluate and knobs you can turn (eg: inflation) to customize to your particular situation. Beyond this, the feature I like best is its ability to record and store detailed expense information, which FIRECalc cannot do.

That reminds me. If you have expenses (such as medical) that you want to have inflate at a different rate than your general living costs, it is easy to set them up as a special expense in QLP with their own inflation rate.

 

[braumeister]

RIP does that as well.
IIRC, they default to 7% inflation for medical costs and 3.5% for everything else, but you can tweak it to your liking. A very nice feature.

 

[Ed_The_Gypsy]

Our case is a lot simpler than most people's. Almost all of our assets except the house are in a traditional IRA.
I used outside references to decide on my AA. (100% equities = 50% US/50% foreign).
I then used FireCalc to decide my SWR (3.5% to 4%--big surprise) in order to survive 30 years.
Then I built a spreadsheet that modeled MRDs and taxes from now until age 100. I used a couple of on-line free tax estimator programs to estimate our taxes year-by-year. I compared moving everything to a Roth in different amounts with leaving it in the tIRA. I also checked what would happen if I died at different ages.
I made simple assumptions about ROI (6%), inflation (3%) and the growth of SS over time (1.5%) and reduction of SS benefits by 25% in 2030.

I can't read the future so I chose a simplified model just to develop a reasonable worst-case strategy by comparing different options and learn about the Tax Torpedo.


I am reasonably confident that I have a good strategy now for a best worst-case. Anything that happens different will be a bonus (except if we both die early).

 

[Options]

Having ER'd 9 months ago here are my most trusted retirement calculators.

1) ESPlanner - there is a free online version, but I paid $199 for the Monte Carlo edition. It does an excellent job with tax consideration, both Federal and State, and with SS estimates. Wouldn't have pulled the plug without this calculator.

2) Flexible Retirement Planner - Another excellent calculator that you can use online or download to your computer and it's free. Does include Monte Carlo simulation and considers user controlled tax implications. Good documentation on the website.

3) Optimal Retirement Planner - This free online tool does consider Federal taxes and also provides a suggested Roth conversion strategy.

4) FireCALC - A good calculator for an initial look at you situation, but not having taxes built in is somewhat limiting.

All of these calculators take considerable time to learn how to use and understand their outputs. However, the time invested in them is well worth it and I never would have pulled the plug without them.

+1 regarding ESPlanner. Found it to be very robust, modeling taking SS at various ages, state/federal taxes, and the ability to model a number of life changes as well. I originally used just the Monte Carlo, but after the hysteria on the BH forum regarding Bernstein's "why keep playing when you've won the game" (which I must admit concerned me as well), I found the ESPlanner upside investing tool incredibly comforting. I found out even if the stock portion of my PF loses all value, I can still maintain my standard of living. Bernstein's paper and the tool allowed me to reevaluate my AA such that I'll be reducing my equity exposure next time I rebalance with no consequence to my basic standard of living.

Additionally, I've used all of the above calculators, along with Financial Engines through VG, VG's free FP consult, and a couple others whose names I can't recall. All provided confirmation that my upcoming [not soon enough] ER date is ok.

 

[jollystomper]

In addition to Firecalc I use Quicken Lifetime Planner, Fidelity Retirement Income Planner, and Financial Engines (available through my Megacorp). Via the Financial adviser that Megacorp pays for, I also have them use a modeling tool for me. I still use a spreadsheet to test some unique situations.

I more look at how much the models agree as opposed to their individual specific results. I feel safer taking the "lowest common denominator" among them.

 

[MRG]

Fidelity's RIP, seems to give the most conservative answers, Firecalc easy to use, did TRPrice it was ok. I've not used quicken or some of the other's. Wonder if their more conservative?
MRG