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Fidelity Retirement Analysis Tool
Old 09-18-2021, 04:15 PM   #1
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Fidelity Retirement Analysis Tool

My Fidelity Wealth Management Advisor introduced the Fidelity Retirement Analysis tool to me during a retirement planning session last week. Based on the numbers inputted (income & expenses, etc.), at the end of the plan, I still have money left over using the significantly below average market. I even estimated my discretionary expenses (inputted in the Detailed Expenses section) on the high side.

The Fidelity advisor gave me the thumbs up that I can retire today. I'm very cautious and want to be sure about the decision to retire.

For those that have used the tool, how accurate is it? Can you trust the analysis that is given by the tool?

Thanks
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Old 09-18-2021, 04:25 PM   #2
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Back when it was still called the RIP (dumbest name ever), my Fidelity guy walked me through it and showed me some tricks with it that I hadn't figured out on my own. But the bottom line was the same; I was fine.

FIRECalc is still my favorite calculator, but between that, FIDO's tool, and I-ORP, as long as you read the instructions for each of them and use them as intended you really can rely on the results you get.
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Old 09-18-2021, 04:47 PM   #3
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Originally Posted by G-Man View Post
My Fidelity Wealth Management Advisor introduced the Fidelity Retirement Analysis tool to me during a retirement planning session last week. Based on the numbers inputted (income & expenses, etc.), at the end of the plan, I still have money left over using the significantly below average market. I even estimated my discretionary expenses (inputted in the Detailed Expenses section) on the high side.

The Fidelity advisor gave me the thumbs up that I can retire today. I'm very cautious and want to be sure about the decision to retire.

For those that have used the tool, how accurate is it? Can you trust the analysis that is given by the tool?

Thanks
I have used it. It is grossly conservative. If the Fidelity tool gives you a thumbs up, you are good to go.
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Old 09-18-2021, 04:53 PM   #4
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I have used it. It is grossly conservative. If the Fidelity tool gives you a thumbs up, you are good to go.

Yeah, I thought the same thing about Fidelity. FIRECALC on the other hand seems really too optimistic, but I guess using history the numbers are what they are !
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Old 09-18-2021, 04:56 PM   #5
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I have used the Fidelity retirement planning tool for the last 15 years and it has always said we are doing just fine. We just became Fidelity clients again and pulled out the old data and updated with current data. It still tells me that we are in great shape in a significantly below average market. I do really like the breakdown of expenses as it makes me think through more thoroughly.
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Old 09-18-2021, 05:01 PM   #6
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Are there any special gotchas as it relates to inputting your data into the Fidelity tool?

For example for "Retirement Expenses", I using the "Detailed Expenses" worksheet. I entered data into the Housing and Health Care & Insurance buckets. These are considered Essential expenses. I create a Custom Expense bucket called "Discretionary" and entered a lump sum for all my other monthly expenses.

Just trying to make sure I enter the data correctly in the tool so it gets me the correct analysis.
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Old 09-18-2021, 05:05 PM   #7
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Back in early 2008, when I was planning my ER, I went to my local Fido and met with my Account Executive to get an outside opinion about my ER plan. I wasn't yet a member of this forum, and I had never heard of FIREcalc. I printed out my budget and my non-Fido assets and brought it all to the meeting. She input my data into the RIP program (yes, it has a morbid name LOL) and gave me an enthusiastic thumbs-up for my ER.

Since 2008, and with different AEs, we have updated my RIP data but each time it shows just what I expect it to show: I am fine prior to age ~65, then, when my "reinforcements begin arriving, my ending portfolio value explodes.

One minor complaint about the program is that I can't vary the federal income tax rate to better suit my personal situation (the program assumes some tax rate based on who-knows-what). Furthermore, I can't vary my state income tax rate if I happen to want a tax rate lower than the federal one. (If I want a higher rate, I can assign it to the Local Tax rate).
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Old 09-18-2021, 05:08 PM   #8
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So it looks like folks trust the Fidelity tool.

Once again, are there any special considerations when inputting your data into the tool?
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Old 09-18-2021, 05:26 PM   #9
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Originally Posted by G-Man View Post
Are there any special gotchas as it relates to inputting your data into the Fidelity tool?

For example for "Retirement Expenses", I using the "Detailed Expenses" worksheet. I entered data into the Housing and Health Care & Insurance buckets. These are considered Essential expenses. I create a Custom Expense bucket called "Discretionary" and entered a lump sum for all my other monthly expenses.

Just trying to make sure I enter the data correctly in the tool so it gets me the correct analysis.
The most interesting part about the tool is the "Retirement Expenses". I don't remember how I first created it years ago. Right now, my Discretionary items are Recreation, Entertainment, Charitable Donations and Gifts. You can just play with it and adjust etc.

Update: I went back to look. There is a box on the right each line item. If you check it, it will turn the line item to essential.
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Old 09-18-2021, 05:29 PM   #10
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So it looks like folks trust the Fidelity tool.

Once again, are there any special considerations when inputting your data into the tool?
Not really any special considerations. As I remember the inputs were really for me, enter my breakdown of expenses. Once entered it's just simulation. I ran every planner I could find RIP, a great name if you were the developer, was by far the most conservative.
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Old 09-18-2021, 05:33 PM   #11
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I also use the Fidelity too along with of course I-Orp and Firecalc. I trust them all, especially when they all say I'm good.

As for any special considerations on inputs, Garbage In = Garbage Out. I don't think it will tell you if you if you missed something major like groceries or medical premiums. It is up to you to ensure accuracy and completeness. Maybe you are looking for a tool that compares your itemized costs with the median of all users?
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Old 09-18-2021, 06:03 PM   #12
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The output is as accurate as the input. My problem is that I don't know what the market will do, what inflation rate will be or how long I'll live. Fifteen years into retirement I've quit worrying about it.
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Old 09-18-2021, 06:35 PM   #13
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I just ran the Fidelity tool. To me it's overly simplistic, and overly conservative. I prefer the RPM spreadsheet, portfoliovisualizer "Financial Goals" example and my own homebrew spreadsheet.

@G-Man what is your initial withdrawal rate at start of retirement?
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Old 09-18-2021, 06:42 PM   #14
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I just ran the Fidelity tool. To me it's overly simplistic, and overly conservative. I prefer the RPM spreadsheet, portfoliovisualizer "Financial Goals" example and my own homebrew spreadsheet.

@G-Man what is your initial withdrawal rate at start of retirement?
8.09%. It gets significantly lower when pension kicks in at 60, SS at 62, mortgage ends, and Medicare at 65.
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Old 09-18-2021, 06:52 PM   #15
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I have used it and found it came up with similar results to other tools. I added fluff to expenses with all the tools to give Rome extra confidence. We have an advisor at fidelity who walks through the inputs each time we meet her.you may find it helpful if you can get an appointment. I always appreciate a 2nd, 3rd or 4th opinion.
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Old 09-18-2021, 06:55 PM   #16
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I have used it and found it came up with similar results to other tools. I added fluff to expenses with all the tools to give Rome extra confidence. We have an advisor at fidelity who walks through the inputs each time we meet her.you may find it helpful if you can get an appointment. I always appreciate a 2nd, 3rd or 4th opinion.
Same here. I added some fluff to the discretionary expense buckets.
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Old 09-18-2021, 06:59 PM   #17
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I don't understand the complaint about the Fidelity tool being overly conservative. I would much rather have the calculator be overly conservative than the FireCalc tool that tells me that I may have up to 80 Million dollars at my end of life, all entered with the same data.
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Old 09-18-2021, 07:06 PM   #18
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I don't understand the complaint about the Fidelity tool being overly conservative. I would much rather have the calculatorbe overly conservative than the FireCalc tool that tells me that I may have up to 80 Million dollars at my end of life, all entered with the same data.

I know right?!



That is the beauty of compounding though. if you have 7 figures now, don't spend a lot and have 35+ years with a heavy stock allocation history tells us your portfolio will skyrocket over a few decades!
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Old 09-18-2021, 07:09 PM   #19
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I don't understand the complaint about the Fidelity tool being overly conservative. I would much rather have the calculatorbe overly conservative than the FireCalc tool that tells me that I may have up to 80 Million dollars at my end of life, all entered with the same data.
Overly conservative may drive a person to work longer than necessary, or to spend below what is a sustainable withdrawal rate. Both scenarios, working longer than necessary, or spending lower than allowable, may represent a lower quality of life/standard of living than the person had hoped for. All because of an overly conservative model, assuming the hypothetical person in question didn't understand the underlying workings of Fidelity's model.

An overly conservative model will fill the graveyard up with the richest people in all of history.
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Old 09-18-2021, 07:11 PM   #20
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8.09%. It gets significantly lower when pension kicks in at 60, SS at 62, mortgage ends, and Medicare at 65.
@G-Man I like your initial WD rate. I'm surprised the Fidelity tool gave a thumbs up to a scenario with that initial WD rate.
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