Group For Retirement? 1

[kontiki99]

Looking for a group oriented around post retirement topics. Specifically looking for an Excel model to predict income & taxes with SS and 401k.

My posts reflect my personal views and are not in any way endorsed or approved by any organization I'm professionally affiliated with.

 

[GC_Hopi]

If you are looking for results it would be best to hire a financial advisor for retirement planning. They have this tools and experience. Obviously do your due diligence before picking someone/firm. If this is the initial planning then there are free tools with the company that you have your 401k with. If not then switch your 401k or open an IRA with a company that has these tools.

If you are doing this as a side project there are several good reads on this topic that can help you develop an excel.

 

[Latexman]

Check out

https://www.early-retirement.org/.

Over there I go by latexman also.

They sponsor a spreadsheet called FIRECalc.

Good Luck,
Latexman

 

[pmover]

I'll 2nd Latexman's suggestion . . .

 

[Latexman]

Thank you, Khun pmover.

Early-retirement.org covers much, much more than “retiring early”, and it is well moderated. I’ve learned a lot there.

Good Luck,
Latexman

 

[IRstuff]

The top thread when I just went there was Article - 35% of Millionaires won't be able to retire which has the following passage

“A million may seem like a lot, but many people are surprised when they do the math and realize that 4% of $1 million is only $40,000 yearly,” David Goodsell, executive director of the Natixis Center for Investor Insight, told CNBC. “This is usually quite a bit less than these individuals are likely used to living on.”

So, yeah, probably be needing more like $4M-$8M in savings, since the 4% isn't quite the "safe withdrawal" rate that Bergen thought.

This site has a bunch of great articles, particularly on "safe withdrawal rate" (SWR), and actually probably has more on SWR than most can tolerate, since the author tends to be more on the math side, but, we're engineers, and we CAN handle the math!

TTFN (ta ta for now)
I can do absolutely anything. I'm an expert!

https://www.youtube.com/watch?v=BKorP55Aqvg

faq731-376 forum1529 Entire Forum list

http://www.eng-tips.com/forumlist.cfm

 

[Latexman]

LI, I like ERN too; it's a post-grad level retirement site.

Good Luck,
Latexman

 

[CWB1]

A million may seem like a lot, but many people are surprised when they do the math and realize that 4% of $1 million is only $40,000 yearly

...and that the cost-of-living compounds significantly over decades of pre&post retirement.

 

[IceNine]

...and that the cost-of-living compounds significantly over decades of pre&post retirement.

The idea with the 4% safe withdrawal rate is that you can increase it annually with inflation, so it should keep up with cost of living increases.

 

[IRstuff]

The idea with the 4% safe withdrawal rate is that you can increase it annually with inflation, so it should keep up with cost of living increases.

The issue with the 4% rule is that it works only under certain circumstances, which ERN, which has a series of blogs on SWR, I cited earlier goes into gross and gory detail. The TLDR answer is that an withdrawal rate of around 3.3% gives you a significantly higher probability of not outliving your savings, which should be everyone's goal.

ERN's SWR series is here

https://earlyretirementnow.com/safe-withdrawal-rate-series/

TTFN (ta ta for now)
I can do absolutely anything. I'm an expert!

https://www.youtube.com/watch?v=BKorP55Aqvg

faq731-376 forum1529 Entire Forum list

http://www.eng-tips.com/forumlist.cfm

 

[Latexman]

The issue with the 4% rule is that it works only under certain circumstances, which ERN, which has a series of blogs on SWR, I cited earlier goes into gross and gory detail.

We calculate safe withdrawal rates for all possible combinations of 1) starting dates, 2) retirement horizons, 3) equity weights, 4) final asset values and 5) withdrawal patterns:
1739 possible retirement start dates between February 1, 1871, and December 1, 2016.
4 different retirement horizons: 30, 40, 50, and 60 years
21 different equity weights from 0% to 100% in 5% steps (bond weight = 100%-equity weight)
5 different final asset value targets: 0%, 25%, 50%, 75% and 100% of real inflation adjusted initial asset value
9 different withdrawal patterns. The baseline assumes that withdrawals are adjusted in line with CPI inflation, but we also allow for slower than CPI-growth. We also check how lower withdrawal rates 20 or 30 years after the retirement start date (to account for Social Security income) will impact the maximum sustainable withdrawal rates.
Hence, we calculate 1739 x 4 x 21 x 5 x 9 = 6,573,420 different safe withdrawal rates.

ERN does a good job of tabulating and graphing the many safe withdrawal rates, so it's not too difficult finding your own personal sweet spot.

And, if that is not enough, they have a Google Sheet you can copy and calculate your own personal safe withdrawal rates given your own personal data, like nest egg, social security strategy, pensions, inheritances, expenses, kids college, time horizons, gifting, etc.

Good Luck,
Latexman

 

[jsr3]

Merrill Lynch Wealth management - sample/template file attached