FIREcalc results on this plan

[augam]

With a portfolio of 1,650,000 my input in FIREcalc was a retirement date some time before end of 2020 year - I will be 60. 42 year duration.

I need 75k in expenses figuring 87k before 13% total tax bill. One time lump sum withdrawal in 2021 of roughly 75k to payoff small mortgage balance. Secondary plan would be to split that lump sum withdrawal over 2 years 2021/22 to perhaps stem tax bite.

Taking SS me @70 43k/yr DW 21k/yr @62 figuring ( spousal support) half of what I am getting.

Results were 100%.

Seem right? Just a 2nd or extra 100 set of eyes

Thanks in advance.

[Dtail]

What year will DW be 62 y.o.?

[Perryinva]

You don’t even need FIRECALC for that! Basically you need to accept that you will be living off a higher than sustainable rate for 10 years and then a very low rate after that.

The problem is that most people have a mental problem aggressively reducing their portfolio that long of a time, even knowing that afterwards, with basically 80% of income derived from SS 10 years from now. I’m not saying that is risky at all, just a mental hurdle few can be comfortable with once they have accumulated a large nut.

We have a similar sized portfolio. My current real living expenses round up to about $5k/m. Once my SS kicks in in 6 years, our fixed income will be a bit over $10k/m, with long term RMDs & Roth withdraws a few years after that of another planned @$2k/m, which should be about a 2% WR. So pulling even just $4k/m for the next 6 years, though easily sustainable even with 0% returns, still meets with mental resistance from me. I’ve always had a paycheck that covered everything plus investing, but now a smaller pension and future SS takes it’s place. The math proves it is very easy and I intend to stick to it, but it is still mentally challenging, because I never lived FIRE entirely on my portfolio.

[bizlady]

Quote:

Originally Posted by augam Taking SS me @70 43k/yr DW 21k/yr @62 figuring ( spousal support) half of what I am getting.

Are you sure about her SS? Unless she is taking her own SS at that age, if she takes yours at 62, it will likely be closer to 70% of what your age 67 amount would be.

[augam]

Quote:

Originally Posted by Perryinva You don’t even need FIRECALC for that! Basically you need to accept that you will be living off a higher than sustainable rate for 10 years and then a very low rate after that. The problem is that most people have a mental problem aggressively reducing their portfolio that long of a time, even knowing that afterwards, with basically 80% of income derived from SS 10 years from now. I’m not saying that is risky at all, just a mental hurdle few can be comfortable with once they have accumulated a large nut. We have a similar sized portfolio. My current real living expenses round up to about $5k/m. Once my SS kicks in in 6 years, our fixed income will be a bit over $10k/m, with long term RMDs & Roth withdraws a few years after that of another planned @$2k/m, which should be about a 2% WR. So pulling even just $4k/m for the next 6 years, though easily sustainable even with 0% returns, still meets with mental resistance from me. I’ve always had a paycheck that covered everything plus investing, but now a smaller pension and future SS takes it’s place. The math proves it is very easy and I intend to stick to it, but it is still mentally challenging, because I never lived FIRE entirely on my portfolio.

Okay, I fibbed a bit. DW still wants to work and is currently 53/54 ish her annual 30k gross gives me an edge.

Truth be told I have a higher stress career than I need at this point and if she didn't want to work or cut her hours even more I more than likely would had some side gig for spending money.

[augam]

Quote:

Originally Posted by bizlady Are you sure about her SS? Unless she is taking her own SS at that age, if she takes yours at 62, it will likely be closer to 70% of what your age 67 amount would be.

This is what I was not sure of and will model this into i-ORP/FIREcalc, and Pralana and give it a go.

My 67 amount would be 36k/yr* 0.70 = ~25k/yr

Thank you

[Dtail]

Quote:

Originally Posted by augam This is what I was not sure of and will model this into i-ORP/FIREcalc, and Pralana and give it a go. My 67 amount would be 36k/yr* 0.70 = ~25k/yr Thank you

What is your asset allocation?
Firecalc defaults to 75/25.

[The Cosmic Avenger]

Sorry, I know I say this a lot, but that's why I like the Fidelity retirement planner. If you have any accounts with them, you can input all your other info and get a detailed plan. Mine is still based on pre-recession numbers, so it's now showing a shortfall; obviously, if things don't improve in the next 4-5 years, we might work longer or reduce our travel or other optional spending. But note that the spending does include large withdrawals (blue bars) until we turn 70, and then much smaller withdrawals supplemented by SS (yellow).

(The climb and then drop in spending is for private/ACA health insurance until we qualify for Medicare.)

[augam]

Quote:

Originally Posted by Dtail What is your asset allocation? Firecalc defaults to 75/25.

I used defaults for mixed portfolio and total market.

[augam]

Quote:

Originally Posted by The Cosmic Avenger Sorry, I know I say this a lot, but that's why I like the Fidelity retirement planner. If you have any accounts with them, you can input all your other info and get a detailed plan. Mine is still based on pre-recession numbers, so it's now showing a shortfall; obviously, if things don't improve in the next 4-5 years, we might work longer or reduce our travel or other optional spending. But note that the spending does include large withdrawals (blue bars) until we turn 70, and then much smaller withdrawals supplemented by SS (yellow). (The climb and then drop in spending is for private/ACA health insurance until we qualify for Medicare.)

Yes I am at Fidelity and use that planner extensively. I am always game for new planners/calculators especially when they are free.

Just bought Pralana and have been using it for the last week and a half. Takes some getting used to but I think it's well worth it and it has been a great learning tool.

I will say based on my limited experience with it is more conservative than the Fido planner. it also allows many more scenario's and what if scenarios - some that are functionally dynamic. you can see the changes as you arrow down or up.

I also have Quicken and use it's planner.

sheez now that I think of it I use several.


Fido

Quicken

i-ORP

FIREcalc - both

Pralana

[Dtail]

Quote:

Originally Posted by augam I used defaults for mixed portfolio and total market.

At the defaults, it looks like you are at 100% success with a maximum spending of ~91k at 100%.

[augam]

This what I am seeing running Monte Carlo scenario through i-ORP.

[Dtail]

Quote:

Originally Posted by augam This what I am seeing running Monte Carlo scenario through i-ORP.

I ORP has many different spending scenarios you can try out which gives maximum spending.

[Perryinva]

Quote:

Originally Posted by augam This is what I was not sure of and will model this into i-ORP/FIREcalc, and Pralana and give it a go. My 67 amount would be 36k/yr* 0.70 = ~25k/yr Thank you

No, 50% of your FRA is the MOST she can get. Bizlady meant at 62, your wife gets about 70% of THAT, or about $12,600/yr. If she continues to work until 62 and has any kind of decent salary, it is likely her own SS would be higher.

[augam]

Quote:

Originally Posted by Perryinva No, 50% of your FRA is the MOST she can get. Bizlady meant at 62, your wife gets about 70% of THAT, or about $12,600/yr. If she continues to work until 62 and has any kind of decent salary, it is likely her own SS would be higher.

Got it. I will enter that into the models.

Thanks