Can someone run my numbers?

[427Vette]

I have ran my numbers through Firecalc a number of times and I keep getting results that seem more favorable then I think that they should be. Could one of you run them and let me know the results?

Basic info:

Spending=$90,000 (includes taxes and health care insurance with lots of "fluff" figured in)

Current Portfolio=$2,200,000

Time period=45 years

Other income is social security=$22,000 for both my wife and I combined starting in 2034.

We want to retire in two years and will add $50,000 per year until then.

I have been using the constant spending and the CPI inflation adjustment.

I have a 60/40 split portfolio with a .3% expense ratio.

I currently own $545,000 in recreational real estate (this does not include our personal home). I will eventually sell it all but for the purposes of this calculation I have been inserting selling $260,000 worth of it in or around the year 2027.

We will have no other pensions or income. There is no debt at all. When I decide to retire My accounts receivables will be added to my portfolio. That amount fluctuates right around $200,000. If I am able to sell my business there may be other $'s but I don't plan on any of that. There could also be the possibility of gaining some $'s from some equipment sales but I wont know any of that until the time comes. I haven't been including any of the accounts receivable or anything else other than what is stated above into the Firecalc calculation.

If some of you wouldn't mind taking the time to run this I would appreciate it. I thinking I might be screwing something up but I hope not. If I am overlooking something or more info is needed please let me know.

 

[Gumby]

I get a 100% success rate with your numbers. Max spending level for 95% success rate is $105,392.

I would say this is not unexpected. $2.3 million, which is probably what you will have in two years, will generate $92k per year at 4%. Your social security and real estate asset sale will serve as reinforcements.

 

[427Vette]

Thanks Gumby!

I know that on this board Firecalc results seem to be very highly regarded. I also see that there seems to be much skepticism on withdrawal rates. Firecalc apparently uses the 4% withdrawal rate but I see that most people here seem to gravitate to the 2.5%-3%.

Can Firecalc be programmed to use a 3% rate?

Should I set myself up to keep working until a lesser withdrawal rate covers my spending?


Where do I go from here?


Thanks For any input.

 

[youbet]

Firecalc does not use a percentage withdrawal rate.

 

[427Vette]

I should have probably used a different heading. It should have read Can I retire with a 100% probability of success from Firecalc.

 

[REWahoo]

Can I retire with a 100% probability of success from Firecalc.

FIRECalc can only tell you how you would have fared historically had you retired with the nest egg, investments, income and spending you input into the calculator. If you believe the future will be no worse than the past, then the answer to your question is "yes".

Some people fear investment returns will be less generous in the future, meaning worse than the Great Depression or the stagflation of the 1970's. They pad their chances of success by either working longer or reducing their planned spending (withdrawal rate). Whatever lets you sleep at night...

 

[Midpack]

I should have probably used a different heading. It should have read Can I retire with a 100% probability of success from Firecalc.

As REW stated, as you probably realize a 100% probability of success is not a guarantee by any means. It just means if the future is no worse than similar periods from 1871 to present, your portfolio will not fail at the WR noted in the results. However, no one can predict the future at 100% accuracy, not FIRECALC or any other tool or person. Many people here have chosen to withdraw at 2-3% even if FIRECALC shows 100% success rate at a 4% withdrawal rate to hedge their chances. Not advocating, just noting.