My dad gave me limited advise over the years. Early on he kept at me to put away for retirement. As I got within sight of retirement he told me to get rid of all my debt and I would have a much easier time in retirement. I wish he was around to see how his advise turned out. With no debt, my SS will more than cover my normal bills. Thanks to dad I'm having an awesome retirement !!
Same here, except I had to learn it all on my own. I wish I could pull a "Back to the Future" event and visit my dad to share with him all I've learned that would have helped him.
The retirement calculators online, and there are many, are informative and can give you peace of mind. It’s great to know you won’t run out of money even if you live a long time. Of course, dementia care could wreak havoc on this.
Another reason to simplify your retirement into low-cost index funds. It will be easier for your spouse to handle when you can't. And do figure out LTC. I've made my plans.
@@IwasRetired My 95 year old MIL is finally using her long term care insurance benefits and it’s paying for an absolutely wonderful assisted living place. It’s like a quiet but spacious dorm with a private bathroom. Her expenses are k-cups for the coffee maker and getting her hair done on premises.
Good assortment of choices to check the question all retirees or soon to be retirees wonder or worry about! I'm still considering New Retirement, but realize that it still will only be as good as the information you put into it.
"Do I have enough (to retire)?" should, in most cases, immediately lead to the question "How much do I want to spend (in retirement)?" Most people would be better served spending more time analyzing their expenses than obsessing over asset allocation, ROI, etc. There aren't many people that truly understand their expenses.
While some think budgeting is a waste of time, I firmly believe you need to build a budget from the bottom up for your retirement to come up with a best estimate. It is not helpful to use rough rules of thumb like 80% of what you used to spend before retirement.
The 4% withdrawal would be for you and your FA would take another 1% every year for AUM. And if you average return is 7%, that leaves 2% to grow for the future.
Well if you are modeling an “X%”withdrawal strategy, you have to include ALL money going out. 4+1 is 5%. Plus the assumption is that taxes come out of the withdrawal also, so a 4% rule with advisor fees is going to only leave 3% for your spending including taxes. Recently Dr Pfau has suggested increasing the % again due to higher interest rates. As to the funding ratio, you can approximate it very quickly by simply assuming that investments only keep up with inflation. In other words keep everything in today’s dollars. Of note it also works for SS since it is also inflation adjusted. We just estimated future spending and income sources by each year from now through age 90. The numbers were encouraging, and in the end we’re almost identical to running everything through New Retirement which took a lot more data entry, and obviously allows inflation and rate of return manipulation. In all cases our numbers look solid from several angles, and we are feeling pretty confident, while realizing we don’t need to take much risk to succeed, as we HAVE ENOUGH!
"NewRetirement utilizes proprietary methods to reasonably estimate taxes and therefore tax estimates should only be considered directional. As needed, consult a tax professional for more precise tax estimate, payment, and filing requirements if you want more precise values. For PlannerPlus users, income taxes are estimated using all currently available state and federal tax rates and tax brackets through longevity." What I like best about NewRetirement, is the documentation of all the assumptions! help.newretirement.com/en/articles/4789289-newretirement-planner-assumptions#h_f01e6eeab8
Awesome, sounds like it at least considers state taxes. I'm playing around with the free version, but will eventually get the paid version. I appreciate your response!
You do realize that nobody, and I mean nobody, does these calculations prior to or in retirement. I just take the square root of my monthly income, multiply it by my total portfolio value, and divide it by the number of letters in my governor's last name. 😅 🤔🙄🙄
My dad gave me limited advise over the years. Early on he kept at me to put away for retirement. As I got within sight of retirement he told me to get rid of all my debt and I would have a much easier time in retirement. I wish he was around to see how his advise turned out. With no debt, my SS will more than cover my normal bills. Thanks to dad I'm having an awesome retirement !!
Your dad's around. He's looking down at you, smiling and thinking "you see, I was right after all"
Same here, except I had to learn it all on my own. I wish I could pull a "Back to the Future" event and visit my dad to share with him all I've learned that would have helped him.
The retirement calculators online, and there are many, are informative and can give you peace of mind. It’s great to know you won’t run out of money even if you live a long time. Of course, dementia care could wreak havoc on this.
Another reason to simplify your retirement into low-cost index funds. It will be easier for your spouse to handle when you can't. And do figure out LTC. I've made my plans.
@@IwasRetired My 95 year old MIL is finally using her long term care insurance benefits and it’s paying for an absolutely wonderful assisted living place. It’s like a quiet but spacious dorm with a private bathroom. Her expenses are k-cups for the coffee maker and getting her hair done on premises.
@@IwasRetired I love your videos. What a helpful activity you picked!
Good assortment of choices to check the question all retirees or soon to be retirees wonder or worry about! I'm still considering New Retirement, but realize that it still will only be as good as the information you put into it.
"Do I have enough (to retire)?" should, in most cases, immediately lead to the question "How much do I want to spend (in retirement)?" Most people would be better served spending more time analyzing their expenses than obsessing over asset allocation, ROI, etc. There aren't many people that truly understand their expenses.
While some think budgeting is a waste of time, I firmly believe you need to build a budget from the bottom up for your retirement to come up with a best estimate. It is not helpful to use rough rules of thumb like 80% of what you used to spend before retirement.
Based on your series of outstanding financial videos, I will bet you do.😀
I have always wondered if you are paying 1% advisor fees on a portfolio does that only leave 3% for yearly withdrawl?
The 4% withdrawal would be for you and your FA would take another 1% every year for AUM. And if you average return is 7%, that leaves 2% to grow for the future.
@@IwasRetired Thanks for clearing that up for me. Appreciate it. Enjoy your videos.
Well if you are modeling an “X%”withdrawal strategy, you have to include ALL money going out. 4+1 is 5%. Plus the assumption is that taxes come out of the withdrawal also, so a 4% rule with advisor fees is going to only leave 3% for your spending including taxes.
Recently Dr Pfau has suggested increasing the % again due to higher interest rates.
As to the funding ratio, you can approximate it very quickly by simply assuming that investments only keep up with inflation. In other words keep everything in today’s dollars. Of note it also works for SS since it is also inflation adjusted. We just estimated future spending and income sources by each year from now through age 90. The numbers were encouraging, and in the end we’re almost identical to running everything through New Retirement which took a lot more data entry, and obviously allows inflation and rate of return manipulation.
In all cases our numbers look solid from several angles, and we are feeling pretty confident, while realizing we don’t need to take much risk to succeed, as we HAVE ENOUGH!
Why not minus the SS in method #2?
25x expenses but do account for your fixed income outside the portfolio.
Does New Retirement cover state tax, specifically California?
"NewRetirement utilizes proprietary methods to reasonably estimate taxes and therefore tax estimates should only be considered directional. As needed, consult a tax professional for more precise tax estimate, payment, and filing requirements if you want more precise values.
For PlannerPlus users, income taxes are estimated using all currently available state and federal tax rates and tax brackets through longevity."
What I like best about NewRetirement, is the documentation of all the assumptions!
help.newretirement.com/en/articles/4789289-newretirement-planner-assumptions#h_f01e6eeab8
Awesome, sounds like it at least considers state taxes. I'm playing around with the free version, but will eventually get the paid version.
I appreciate your response!
You do realize that nobody, and I mean nobody, does these calculations prior to or in retirement.
I just take the square root of my monthly income, multiply it by my total portfolio value, and divide it by the number of letters in my governor's last name. 😅 🤔🙄🙄
Are you from Tennessee? Only three letters in his name.