Author Topic: CNN's "Retirement Calculator"  (Read 8063 times)

zsmith

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CNN's "Retirement Calculator"
« on: January 27, 2016, 09:09:57 AM »
http://money.cnn.com/calculator/retirement/retirement-need/?sr=recirc012516retire0900calculator

I can't put in an age less than 50 and the max savings rate is only 25 percent. I also apparently need 4.4 million to retire based on my current income.

MishMash

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Re: CNN's "Retirement Calculator"
« Reply #1 on: January 27, 2016, 09:13:46 AM »
http://money.cnn.com/calculator/retirement/retirement-need/?sr=recirc012516retire0900calculator

I can't put in an age less than 50 and the max savings rate is only 25 percent. I also apparently need 4.4 million to retire based on my current income.

If it makes you feel any better I can't do either of those things on Vanguards retirement center calculator either.

onlykelsey

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Re: CNN's "Retirement Calculator"
« Reply #2 on: January 27, 2016, 09:15:42 AM »
http://money.cnn.com/calculator/retirement/retirement-need/?sr=recirc012516retire0900calculator

I can't put in an age less than 50 and the max savings rate is only 25 percent. I also apparently need 4.4 million to retire based on my current income.

I need 16.5 mn.  Wow.

That said, at least CNN is drawing attention to the fact that you have to save for your retirement, people! 

Kaspian

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Re: CNN's "Retirement Calculator"
« Reply #3 on: January 27, 2016, 09:20:07 AM »
Yep, pretty much normal.  For most 'retirement calculators' Mustachians are either a) not allowed to put in their numbers or b) break the calculator.  Based on my projections, I'll have $800K at FIRE in about 8 years.  My bank's, however, says I'll have $2 million more than I need so I should stop saving two years ago.  I can only assume they're keeping the savings bar low so as not to depress the average person?  (And keep them impoverished at retirement?  "Don't worry, you'll have millions!!"  Yeah... right!)

nereo

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Re: CNN's "Retirement Calculator"
« Reply #4 on: January 27, 2016, 09:25:26 AM »
http://money.cnn.com/calculator/retirement/retirement-need/?sr=recirc012516retire0900calculator

I can't put in an age less than 50 and the max savings rate is only 25 percent. I also apparently need 4.4 million to retire based on my current income.
That's because it's not possible to retire before 50, nor can one save more than 25% of their pay.  It's just not possible!!
Do you really think $4.4MM is enough?  that's only $176k/year.  It will barely crack the top 5% in the US.  You might need to keep working to avoid becoming a WalMart greeter with that paltry investment portfolio.

onlykelsey

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Re: CNN's "Retirement Calculator"
« Reply #5 on: January 27, 2016, 09:31:50 AM »
Quote
That's because it's not possible to retire before 50, nor can one save more than 25% of their pay.  It's just not possible!!
Do you really think $4.4MM is enough?  that's only $176k/year.  It will barely crack the top 5% in the US.  You might need to keep working to avoid becoming a WalMart greeter with that paltry investment portfolio.

You should probably at least upgrade to numbers like mine.  personally, I plan on spending $660,000/year in retirement.

Gone Fishing

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Re: CNN's "Retirement Calculator"
« Reply #6 on: January 27, 2016, 09:33:22 AM »
Looks like the "Need" total just an extrapolation of your current income and doesn't change based on savings rate.   

Any of the calculators out there use actual spending?  If so, too bad they probably wouldn't be too useful for 90% of the population.

RWD

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Re: CNN's "Retirement Calculator"
« Reply #7 on: January 27, 2016, 09:46:37 AM »
Hmm, changing the savings percentage doesn't even affect the amount they say you will "need" in retirement...

Elderwood17

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Re: CNN's "Retirement Calculator"
« Reply #8 on: January 27, 2016, 09:50:52 AM »
Looks like the "Need" total just an extrapolation of your current income and doesn't change based on savings rate.   

Any of the calculators out there use actual spending?  If so, too bad they probably wouldn't be too useful for 90% of the population.
This drives me nuts.....why is it so hard for "financial experts" to understand that annual income does not automatically translate to annual spending?

nereo

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Re: CNN's "Retirement Calculator"
« Reply #9 on: January 27, 2016, 09:52:13 AM »
Quote
That's because it's not possible to retire before 50, nor can one save more than 25% of their pay.  It's just not possible!!
Do you really think $4.4MM is enough?  that's only $176k/year.  It will barely crack the top 5% in the US.  You might need to keep working to avoid becoming a WalMart greeter with that paltry investment portfolio.

You should probably at least upgrade to numbers like mine.  personally, I plan on spending $660,000/year in retirement.
LOL - having gone back to school and having little income I was uncertain what to put down for income, so I entered what I thought could be a reasonable salary for my wife and I in 3 years.  Turns out I need $3.1MM.
What confuses the heck out of me is that if I enter my wife's age (almost 3 years younger) the amount we "need" jumps to $4.1MM.  WTF?  How can the same retirement age (50 in this case) require more money?  The only changing variable is current age.  I don't get it.

Also curious - I just played with the inputs and it says that I need a minimum of $1MM saved today to be "on the right track" to retire in 19 years with a 25% savings rate.  If I click "today's dollars" it shifts slightly to say "you're almost there" - even though nothing has really changed.

runningthroughFIRE

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Re: CNN's "Retirement Calculator"
« Reply #10 on: January 27, 2016, 09:53:22 AM »
"All calculations are pre-tax"

Well that's boring...

RWD

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Re: CNN's "Retirement Calculator"
« Reply #11 on: January 27, 2016, 10:18:30 AM »
What confuses the heck out of me is that if I enter my wife's age (almost 3 years younger) the amount we "need" jumps to $4.1MM.  WTF?  How can the same retirement age (50 in this case) require more money?  The only changing variable is current age.  I don't get it.

It's estimating inflation. Still seems high for just three more years of inflation though...

There is a "Today's dollars" button in the bottom right. Looks like it still will inflate how much you need if you start younger even with that setting... Perhaps it is assuming your salary will increase faster than inflation?

nereo

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Re: CNN's "Retirement Calculator"
« Reply #12 on: January 27, 2016, 10:35:44 AM »
What confuses the heck out of me is that if I enter my wife's age (almost 3 years younger) the amount we "need" jumps to $4.1MM.  WTF?  How can the same retirement age (50 in this case) require more money?  The only changing variable is current age.  I don't get it.

It's estimating inflation. Still seems high for just three more years of inflation though...

There is a "Today's dollars" button in the bottom right. Looks like it still will inflate how much you need if you start younger even with that setting... Perhaps it is assuming your salary will increase faster than inflation?

... but that's just it.  Even if I click "in today's dollars" it says that we'd need more money (in real terms) at age 50 if I am 29 today vs 32.  That amount shouldn't change for any reason I can think of. 

RWD

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Re: CNN's "Retirement Calculator"
« Reply #13 on: January 27, 2016, 10:46:48 AM »
What confuses the heck out of me is that if I enter my wife's age (almost 3 years younger) the amount we "need" jumps to $4.1MM.  WTF?  How can the same retirement age (50 in this case) require more money?  The only changing variable is current age.  I don't get it.

It's estimating inflation. Still seems high for just three more years of inflation though...

There is a "Today's dollars" button in the bottom right. Looks like it still will inflate how much you need if you start younger even with that setting... Perhaps it is assuming your salary will increase faster than inflation?

... but that's just it.  Even if I click "in today's dollars" it says that we'd need more money (in real terms) at age 50 if I am 29 today vs 32.  That amount shouldn't change for any reason I can think of.

It seems like it is assuming you will receive 1.8% raises every year (relative to inflation) and then will want to spend about 60% of your final income (using the 4% rule).

runningthroughFIRE

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Re: CNN's "Retirement Calculator"
« Reply #14 on: January 27, 2016, 11:12:25 AM »
What confuses the heck out of me is that if I enter my wife's age (almost 3 years younger) the amount we "need" jumps to $4.1MM.  WTF?  How can the same retirement age (50 in this case) require more money?  The only changing variable is current age.  I don't get it.

It's estimating inflation. Still seems high for just three more years of inflation though...

There is a "Today's dollars" button in the bottom right. Looks like it still will inflate how much you need if you start younger even with that setting... Perhaps it is assuming your salary will increase faster than inflation?

... but that's just it.  Even if I click "in today's dollars" it says that we'd need more money (in real terms) at age 50 if I am 29 today vs 32.  That amount shouldn't change for any reason I can think of.

It seems like it is assuming you will receive 1.8% raises every year (relative to inflation) and then will want to spend about 60% of your final income (using the 4% rule).
If it's assuming you'll drop your spending to 60% in retirement, then why the hell doesn't it let you put at least a 40% savings rate?

nereo

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Re: CNN's "Retirement Calculator"
« Reply #15 on: January 27, 2016, 11:45:34 AM »

It seems like it is assuming you will receive 1.8% raises every year (relative to inflation) and then will want to spend about 60% of your final income (using the 4% rule).

Ah, ok.  Nice to understand (even if I don't agree).

Quote
If it's assuming you'll drop your spending to 60% in retirement, then why the hell doesn't it let you put at least a 40% savings rate?
good question. I guess because so few actually manage to save even 25%.  Agree that it's poor design - why not at least let the slider go higher.  Sheesh.

RWD

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Re: CNN's "Retirement Calculator"
« Reply #16 on: January 27, 2016, 12:00:33 PM »
Quote
If it's assuming you'll drop your spending to 60% in retirement, then why the hell doesn't it let you put at least a 40% savings rate?
good question. I guess because so few actually manage to save even 25%.  Agree that it's poor design - why not at least let the slider go higher.  Sheesh.

The funny thing is without changing anything else about the calculator if you were able to set the savings rate to 100% it would still say you need 15+ years to save enough (assuming starting from 0 savings)!

Gone Fishing

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Re: CNN's "Retirement Calculator"
« Reply #17 on: January 27, 2016, 12:21:01 PM »
Best hack I could manage was putting my age in as 50, retirement age as 50, annual spending as annual income and savings rate as 1%.  It says I have enough, yay!   

golden1

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Re: CNN's "Retirement Calculator"
« Reply #18 on: January 27, 2016, 12:44:58 PM »
This is saying I have to work until I am 70 to make 4.2 million to retire.  No thanks. 

Trudie

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Re: CNN's "Retirement Calculator"
« Reply #19 on: January 28, 2016, 02:37:01 PM »
Bogus.  Says all be fine if we work another 16 years instead of 5-6.  These stupid calculators give me heartburn.  They're so deceptive.

Squirrel away

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Re: CNN's "Retirement Calculator"
« Reply #20 on: January 29, 2016, 02:53:14 AM »
I need $2 million oh no, I must panic!

nobodyspecial

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Re: CNN's "Retirement Calculator"
« Reply #21 on: January 30, 2016, 12:06:49 PM »
Any of the calculators out there use actual spending?  If so, too bad they probably wouldn't be too useful for 90% of the population.
Or for 99.9% of the advertisers paying for them

sleepyguy

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Re: CNN's "Retirement Calculator"
« Reply #22 on: January 30, 2016, 07:43:08 PM »
LOL, seems I "need" 6 Million if I retire at 50.


GrumpyPenguin

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Re: CNN's "Retirement Calculator"
« Reply #23 on: February 02, 2016, 11:32:16 AM »
Thanks for postings this, I needed a good laugh :).  Unbelievable how broken these retirement calculators are.

FINate

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Re: CNN's "Retirement Calculator"
« Reply #24 on: February 02, 2016, 02:33:59 PM »
Financial planners and RE calculators tend to focus on replacing a certain percentage of current INCOME post retirement. The typical assumption is that you will need 85% of your current income in retirement. This drives me crazy, it assumes that your lifestyle must always inflate with income, which always pencils out to retirement at a very advanced age, even if you have a financial windfall or lucrative career.

I think they focus on income rather than spending because a) few people actually know what they spend, and b) even fewer people can actually keep their spending in check. Still, it drives me nuts so I just ignore these RE calculations.

TheAnonOne

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Re: CNN's "Retirement Calculator"
« Reply #25 on: February 04, 2016, 09:13:24 AM »
I am 25, set my retirement age to 50.

Put my income in at 200 to 250 a year, at the max savings rate. Didn't even hit HALF of what I needed, apparently... I will have 4.3 million in today's dollars. I think I will be fine..

Tuskalusa

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Re: CNN's "Retirement Calculator"
« Reply #26 on: February 08, 2016, 09:27:07 PM »
Wow!  It's amazing that anyone ever thinks they can retire. Apparently I need $3M, and my husband needs another $3M. $6m for the two of us?  Seriously?