Help me understand Firecalc

[Keim]

I am currently looking at the "your portfolio" tab on firecalc. Please help me understand why I get dramatically different results for each of the options. (All pre-sets from other tabs remain the same for each option I list below.)

For Total Market option: I have it set to 1927, fixed income is set on long interest rate. Equities v fixed income is 80%. This gets me a survivability of 88.6%, with about $4m.

Mixed portfolio-I have let it with the pre-set numbers. This gets me survivability of 100%, with about $18m. (I REALLY like this!)

Consistent Market growth-Again using the pre-set numbers. This gets me a loss of $1.1m, and 0% success.

Random Performance-Again using pre-set numbers. This gets me 85.6% survivability, with about $8m.

Why are these numbers SO different? Especially between Total Market and Mixed Portfolio?

 

[ERD50]

The consistent and random are very different from anything using actual, so I'd expect them to provide different results.

The TM and MP are reasonably close portfolios I suppose, but it just goes to show you how minor changes have a large impact over 30 years. Just try the 'consistent' model with very slight changes and see for yourself.

-ERD50

 

[Keim]

The TM and MP are reasonably close portfolios I suppose, but it just goes to show you how minor changes have a large impact over 30 years. Just try the 'consistent' model with very slight changes and see for yourself.

-ERD50

If that is the case, it seems a telling argument for tilting your portfolio, vs simple indexing.

 

[ERD50]

I suppose it does. Be interesting to tweak those categories to see if there was some better mix.

-ERD50

 

[Rustward]

Keim, the consistent annual market growth option does not work.
You can enter whatever you want for market growth (growth of your equities, I believe this is supposed to be), and Firecalc treats the entire portfolio as fixed income.

So, using the preset numbers, what you are actually getting is
Spending: 30000
Portfolio: 750000
Years: 30
Expense Ratio: 0.18%
Fixed Income Return: 4%
Inflation: 3%

Whatever rate you enter (or use default) for Market Growth is completely ignored. Additionally, for this to work the way it should, Firecalc needs to know how much of your portfolio is in equities, and how much is in fixed income. There is no place to enter this data.