Pension inflation checkbox

[DMMDTM]

So I did two runs. One with and one without inflation checked for pension. I then generated the single year spreadsheet and noticed that the pension values were identical in both runs and both appeared to have had inflation applied. What am I doing wrong?

Thanks!
DTM

 

[Dtail]

Not sure about the spreadsheets, but if you run the numbers with and without inflation, the minimum/maximum results and average remaining portfolio results are clearly different on the FIRECALC website results.

BTW, welcome to the site.

 

[DMMDTM]

Definitely do see the difference. I'm not a math wiz, so can you help me understand why when it shows a change, the values with the inflation box NOT checked have the lower value lower and the higher value higher (so a broader range when the pension isn't inflation adjusted)? I would have expected to see greater variance when the pension had inflation value (more to lose/gain if you will).

Greatly appreciate the insight and glad to have stumbled into this site. Lots of great information!

D.

 

[Dtail]

Definitely do see the difference. I'm not a math wiz, so can you help me understand why when it shows a change, the values with the inflation box NOT checked have the lower value lower and the higher value higher (so a broader range when the pension isn't inflation adjusted)? I would have expected to see greater variance when the pension had inflation value (more to lose/gain if you will).

Greatly appreciate the insight and glad to have stumbled into this site. Lots of great information!

D.

While I use Firecalc quite a bit, I will defer to my seasoned Firecalc usage members to give a mathematical/model type response, as I don't currently have this insight.

 

[ERD50]

I haven't looked at those spreadsheet outputs in a long time, but I think that maybe what you are seeing is, all the other numbers are inflation adjusted. So if a pension is inflation adjusted, it just sort of rides the wave with the other numbers.

If it's not inflation adjusted it gets changed by inflation while the others stay constant with respect to inflation.

Could that explain what you see?


-ERD50

 

[DMMDTM]

Fundamentally, the "non-inflation" is showing inflated values but using non-inflated in the calculations. Makes the spreadsheet tough to use as a validation tool but the graphics and summary page appear correct. I'm just a "trust but verify" type of guy. Appreciate the inputs!

D.

 

[hh22]

I was just about to post a new thread as I recently noticed this. I emailed the FIRECalc creator a couple of weeks back but never heard back. Here is what I said in that email:

"In the "Pensions, "Off Chart" Spending Changes, etc. section, when I select Pension Income...I'm always seeing what appears to be an inflation adjusted increase irrespective of whether the "Inflation adj?" box is checked.

The pension I'm scheduled to receive is not inflation adjusted but when I review the results (within the "single-year" spreadsheet) the output for the pension increases identically whether or not that box is checked. The only way I could get it to remain constant was to change the inflation assumption in the "Spending Models" section to 0%

Actually, I would expect a non inflation adjusted pension to show as a diminishing value as the years progressed?"

 

[Dtail]

I was just about to post a new thread as I recently noticed this. I emailed the FIRECalc creator a couple of weeks back but never heard back. Here is what I said in that email:

"In the "Pensions, "Off Chart" Spending Changes, etc. section, when I select Pension Income...I'm always seeing what appears to be an inflation adjusted increase irrespective of whether the "Inflation adj?" box is checked.

The pension I'm scheduled to receive is not inflation adjusted but when I review the results (within the "single-year" spreadsheet) the output for the pension increases identically whether or not that box is checked. The only way I could get it to remain constant was to change the inflation assumption in the "Spending Models" section to 0%

Actually, I would expect a non inflation adjusted pension to show as a diminishing value as the years progressed?"

Don't know the answer, but it is interesting as the ending balances of success possibilities definitely are different depending if the inflation box is checked or not checked.