good firecalc %

[kongmen]

What % success rate do folks shoot for in firecalc?

 

[COcheesehead]

100% personally, though there is little difference if you shoot for the default of 95%.

 

[Major Tom]

>100%. I like to be sure though, in this case of course, absolute certainty is not possible. With a WR of 2.2% of the current portfolio value, and early SS on the way in a few years (if I choose to take it), I'm comfortably above 100%. I like it that way.

 

[tb001]

When we started down this path I felt pretty good at anything above 90%. I was very done with work and desperate to get out. When we finally pulled the plug we were at 96%. A little over a year later and now at 100%. It feels way, way better to be in the 100% ballpark.

 

[Morgan22]

100%. We wouldn't have felt comfortable with anything lower.

 

[mrfeh]

Just as important as the success % (probably even more so) is the nature of your annual expenses and your flexibility.

• what percentage of your annual spend is core (definitely needed, ever year) vs discretionary?
• are you willing to make mid-course corrections if returns are poor?

Look at VPW as an alternative to the fixed percentage firecalc uses.

Just remember firecalc uses historical returns; nobody knows what will happen in the future.

 

[razztazz]

100% knowing that's just for 100% of the past. The future can be no better than a theoretical 99% because there's always something.

 

[FLSUnFIRE]

100% but I've got (I sure hope!) a long time to be withdrawing. "100%" is a bit misleading, always remember that's historical and no one knows the future! I hope, and statistically am likely to (based off history) see my portfolio grow substantially and will adjust my spending up as my remaining time decreases and I pass the SORR risk zone early in my RE!



My actual withdrawals will be based on what I need to cover my expenses while managing taxable income and not based off of FireCALC as it is a planning and not an execution tool.

 

[Andre1969]

I have a range:
95% or better: success.
80-95%: if I lost my job, I wouldn't be in a hurry to find another one. My sense of urgency would be where in that range I am, and also on how much fat I could cut out of the budge.
<80%: Failure. If I lost my job, finding another one would be a priority, and I'd definitely be cutting back on the budget.

I'm actually at a 100% success rate right now, according to FireCalc, so I could afford to retire, and even live it up a bit compared to where I'm at. But, for the time being I feel comfortable with the whole work/life balance thing. With each passing day, I do feel my time becoming ever more valuable, and work becoming less relevant, but I'm not at that tipping point, yet. But I'm hoping to be soon!

 

[Vincenzo Corleone]

What % success rate do folks shoot for in firecalc?

100%

 

[tmm99]

100% for me as well. And I would never spend that much.

 

[Taxman59]

I was satisfied with FireCalc at 95% and RIP at 95% and a program we had at work at 95%. It meant that historical (FC) Monte Carlo (RIP) and variable (can't remember the work program) all had me being successful to age 95. I figure that I will easily make it to 85 based on family history, and after that, I will be enjoying life with whatever I have left. If I run out of the assets, I will still have an annuity and SSI, and three DS to live off of!

 

[Willers]

We wouldn't have retired with anything less than 100% with a floor amount left over (rather than going to $0). We reached that and pulled the plug. I might have retired with less, but this made DW comfortable and that was critically important.

 

[rodi]

For me, hitting 100% after I'd made sure my spending included EVERYTHING. (Some people forget to include expenses like taxes and health insurance.)

But it comes down to the 'which bucket is fuller' thing too. If you hold a bucket in each hand - one is full of money, one is full of work BS... when one becomes a lot heavier than the other - it's time to make a change... For me, I'd been at 100% without some of the extras I wanted to fund (discretionary)... when my BS bucket got filled up by an unreasonable work request... Since I knew I could afford a stripped down retirement, I gave notice.

 

[MichaelB]

My first run at FIRECalc was less then 85%. I had already quit my job and ran the numbers that we had then. I’ve often wondered what I would have done if I saw those numbers before quitting.

Since then, we have lived well and without constraint, including lots of college spending for the kids, withdrawing more than 4% per year most years. My FIRECalc number now is 100% and our withdrawal rate this year is around 3.5%. It fell to 3% a few years back and I chose to loosen the purse strings a bit.

 

[OldShooter]

I don't think anyone would expect that the next 30 years' ups and downs will be the same ones as we experienced in the last 30 years. This is why none of these calculators can credibly claim to be predictive. FireCalc does not.

From a career in science and engineering, my view is that attempting to assign a precise probability and then use it as if it were predictive is a classic garbage-in, gospel-out scenario. 100% is probably the same as 90% and maybe even the same as 80%. @MichaelB's experience illustrates. If I were to write one of these planners it would probably have three possible outputs: "Doesn't Look Good," "Pretty Marginal, be ready to adapt to immediate circumstances," and "Looks Pretty Good, but luck is always at the table." Really, for @MichaelB 85% is working out to be more like 100%, probably buoyed by the recent good market. For the next retiree, 100% may turn out to be more like 85% if the market gives them a bad dose of SORR.

Clint Eastwood/Dirty Harry's famous line pertains to retirement planning: "...you've got to ask yourself one question: 'Do I feel lucky?' Well, do you, punk?"

 

[calmloki]

I continue to have problems with the math and the safe percentage rates. Firecalc offers various inflation rates and tax rates and my memory includes wildly variable tax and interest rates, and presumably inflation. We are in the safe unless the Aliens attack percentage area - and even there my nights can visit dire possibilities.

 

[Sojourner]

100%, using the most conservative assumptions I can. For example, I consider my safe withdrawal number to be what FIRECalc spits out when I've set it for 100% success rate, no future inheritance, constant spending power (no Bernicke reductions starting at age 56), and no Social Security.

 

[CaptTom]

Clint Eastwood/Dirty Harry's famous line pertains to retirement planning: "...you've got to ask yourself one question: 'Do I feel lucky?' Well, do you, punk?"

True. But what's the alternative?

We can only take so many factors into consideration. Presumably, if I'm left standing in a smoldering hellscape, I'll have bigger issues to contend with than how my portfolio is doing.

You play the odds, and you take your chances. I'm not ready to run off into a bunker in the woods to become a prepper. My assumptions are based on the fact that things will continue to go as they have for the past couple of hundred years. Civilizations have come and gone before. I just hope I'm not the unlucky one who lives to see the end of ours.

It's not something I can do anything about, so it's not worth planning for. I'm pretty happy with my FIRECalc 100% results.

 

[GalaxyBoy]

An oldie but a goodie on the subject:

The Retirement Calculator from Hell, Part III

Let’s examine a small sampling of possible political, economic, and military failure modes:

The mildest scenario is that of catastrophic inflation, as experienced in Germany and Hungary in the 1920s or, more recently, in much of the developing world.

Political failures are slightly worse, since these threaten the basic human motivation to work and produce. The state, for whatever reason, can decide to confiscate your assets or, worse, society’s means of production. Anyone who judges this unlikely should turn on CNN during any G-8 or WTO conference.

Local military action. Probably the lowest-probability item on this list, but something to think about on other continents.

The Big One: Some deranged prime minister or colonel in central Russia, Pyongyang, or South Asia could let loose the four horsemen upon the planet.

So, think about what a 97% 40-year success rate means: the absence of all of the above for approximately the next 1,200 years. (A 97% success rate means a 3% failure rate; those 40 years divided by 0.03 is 1,200 years.) Ignore for a minute the uncertainties of the less-developed world and think only about the winners: Germany—in this century alone, three episodes of military and/or economic disaster, the first two associated with mass starvation. Japan—wartime devastation even worse than Germany’s. England—near brushes with disaster in 1812-1814 and in both world wars. And even the United States—repeated banking failures, civil war, and the near-bankruptcy of the Treasury in the 19th century. The near collapse of the capitalist economy in the 1930s. And oh yes, I almost forgot—the entire globe barely missed mass incineration in October 1962.

 

[Romer]

Firecalc is a litmus test using historical data and as stated is no guarantee of success, but it is a worthwhile piece of data. I was comfortable with 95% but my score was 100%

I also took my current spending, escalated it for inflation and ran out how long it would last at 0% return (Yes I know it can be negative) and it lasted until 89.

I then played with reducing some discretionary spending that doesnt really effect my quality of life and was able to extend it to 97

That was all without having to sell my house which I could be in a nice place for half the value of my house and live off the other half for another 7 years (Plus pension and SS) if I had to

I used the historical test of Firecalc and some forward evaluations to decide I was ready.

All these together are a guess as there is no prediction that accurately has forward inflation and forward ROI. I could just as easily lose a chunk of my money and that is a risk. Or I could have to help my kids after a disaster.

My view is these tools and methods help you see you are not in a high risk position like a firecalc score of 50% would be high risk to me

 

[cyber888]

I'm at a 100% and will always aim for 100% for a 40 year retirement.

 

[karen1972]

I was good with 95%, I included SS w/ 25% haircut.

I think it depends on how accurate your budget is, what part is discretionary and how important it is to never have to worry about having to trim.

I'm completely ok with trimming if need be and I've tracked my expenses in Quicken for 25+ years so I was fine with 95%.

 

[Sojourner]

So, think about what a 97% 40-year success rate means: the absence of all of the above for approximately the next 1,200 years. (A 97% success rate means a 3% failure rate; those 40 years divided by 0.03 is 1,200 years.)

Huh? 1,200 years? That's not what I think a 97% success rate over 40 years implies in FIRECalc. If FC gave me a 97% success rate, I would take it to mean that there is roughly a 3% chance of portfolio failure over any given 40 year period going forward (assuming the future is like the past). And FIRECalc does take into account black swan events and other catastrophes, since it uses actual historical data from the world we've lived in over the past 100+ years. I don't get what "1,200 years" is supposed to mean in this context.

 

[Koolau]

100% and then add in some back ups (what could I cut, where could I move, what would I settle for? Just in case something went wrong.) YMMV