Fidelity Retirement Score

[Retireatee1]

Fidelity's Planning & Guidance Center has a Retirement Analysis tool that I'm sure many here have used.  I have all of my financial data plugged in, which I'd rather not post here.

There is a Fidelity Retirement Score (FRS) which is produced from 1 - 150, which is basically the percentage of expenses which are covered.  The tool appears to be quite sophisticated.   

My scores are as follows (current age of 49):

Age 51: 91
Age 52: 97
Age 53: 102

Is it worth holding out for the 100, or would you FIRE in the low to mid 90's?  The expense number that I used already has quite a bit of padding, so I don't believe a haircut to 91% would be a big problem.

My Retireator simulation with similar data and set very conservatively produces a result closer to age 51.  So I suspect the 97-102 Fidelity scores are even more conservative.

[Metalcat]

This seems like a less useful version of FireSim calculator, which I already take a huge issue with when people nitpick about 90% success vs 100% success.

As you pointed out, your estimates already have padding, which means they're fundamentally a very, very rough estimate of your likely spending.

If your own estimates are rough, then how can a calculator be accurate down to a few percentage points.

Let's not forget that no calculator can predict the future.

So no, I wouldn't give this extremely rough calculator much credence at all beyond the vaguest of guidance.

[Retireatee1]

This seems like a less useful version of FireSim calculator, which I already take a huge issue with when people nitpick about 90% success vs 100% success.

Why do you say it is less useful than FireSim?  I'm aware of FireSim but haven't run it.  I ran FireCalc a while back and got a 95% score or so if I recall.  FireCalc is decent but doesn't model taxes or Social Security to my satisfaction.  The CSS sheet models the current year spectacularly well but gets lost in 50 year simulations.

I'd be interested to hear about any specific shortcomings of these tools.

[ixtap]

I guess it was bogleheads that recently had a thread on the Fidelity tool. It got mostly pretty good reviews, with similar results to the less commercial tools generally suggested, like FIREism.

[Metalcat]

This seems like a less useful version of FireSim calculator, which I already take a huge issue with when people nitpick about 90% success vs 100% success.

Why do you say it is less useful than FireSim?  I'm aware of FireSim but haven't run it.  I ran FireCalc a while back and got a 95% score or so if I recall.  FireCalc is decent but doesn't model taxes or Social Security to my satisfaction.  The CSS sheet models the current year spectacularly well but gets lost in 50 year simulations.

I'd be interested to hear about any specific shortcomings of these tools.

Perhaps I was looking at the wrong tool, but the one I saw when I googled didn't seem to have as many options as FireSim. That said, I think most of these calculators are a hair above utterly useless for projecting fire success anyway, so it doesn't really matter.

They are AMAZING tools for understanding the impact of various factors on outcomes, I'm not at all saying they're a useless tool, but an estimated outcome of 90% vs 100% in terms of predicting success is pure rubbish.

[slappy]

I actually have kind of the same question as you. What market scenario are you using? The tool has a "sig below average", "below average" and "average". I've been using the significantly below, but I prefer the numbers on the below average. Haha.

[honeybbq]

You May Need
$22,283 /mo


LMAOOOO

[slappy]

You May Need
$22,283 /mo


LMAOOOO

What did you put in to get that number? Mine is based on the expense info I put in, but I know they do have the ability to estimate. I think it depends on how far out from retirement you are.

[Metalcat]

You May Need
$22,283 /mo


LMAOOOO

What did you put in to get that number? Mine is based on the expense info I put in, but I know they do have the ability to estimate. I think it depends on how far out from retirement you are.

Are there two Fidelity calculators, because the one I used gave me equally stupid results.

[Retireatee1]

I actually have kind of the same question as you. What market scenario are you using? The tool has a "sig below average", "below average" and "average". I've been using the significantly below, but I prefer the numbers on the below average. Haha.

This aspect is a bit confusing, but I've studied the way the tool works.  The market setting appears to affect the chart and the Assets at End of Plan output.  It does not affect the Retirement Score, which appears to be fixed at Significantly Below Average.

[Watchmaker]

Are there two Fidelity calculators, because the one I used gave me equally stupid results.

I think the OP is talking about Fidelity's Retirement Planning and Guidance tool, which is more complicated than the simple Fidelity Retirement Score Calculator (though both give you a retirement score).

https://www.fidelity.com/calculators-tools/retirement-planning-and-guidance
https://www.fidelity.com/calculators-tools/fidelity-retirement-score-tool

But to address the original question--non of these models are accurate enough to to justify worrying about the difference between 95 and 100. If you give us your details, we'll tell you how much to worry... with better accuracy.

[Retireatee1]

Are there two Fidelity calculators, because the one I used gave me equally stupid results.

I think the OP is talking about Fidelity's Retirement Planning and Guidance tool, which is more complicated than the simple Fidelity Retirement Score Calculator (though both give you a retirement score).

https://www.fidelity.com/calculators-tools/retirement-planning-and-guidance
https://www.fidelity.com/calculators-tools/fidelity-retirement-score-tool

But to address the original question--non of these models are accurate enough to to justify worrying about the difference between 95 and 100. If you give us your details, we'll tell you how much to worry... with better accuracy.

Thanks for the clarification and links, yes I am referring to the Planning & Guidance Center version of the tool (as I stated in the OP).

The simple version doesn't even allow for entering expenses, it appears to be making an assumption based on income.  That really won't do for the LBYM types.

[slappy]

I actually have kind of the same question as you. What market scenario are you using? The tool has a "sig below average", "below average" and "average". I've been using the significantly below, but I prefer the numbers on the below average. Haha.

This aspect is a bit confusing, but I've studied the way the tool works.  The market setting appears to affect the chart and the Assets at End of Plan output.  It does not affect the Retirement Score, which appears to be fixed at Significantly Below Average.

That makes sense. I don't even really look at the score. I just look at the assets at the end of plan in the different market scenarios.

[dblaace]

Are there two Fidelity calculators, because the one I used gave me equally stupid results.

I think the OP is talking about Fidelity's Retirement Planning and Guidance tool, which is more complicated than the simple Fidelity Retirement Score Calculator (though both give you a retirement score).

https://www.fidelity.com/calculators-tools/retirement-planning-and-guidance
https://www.fidelity.com/calculators-tools/fidelity-retirement-score-tool

But to address the original question--non of these models are accurate enough to to justify worrying about the difference between 95 and 100. If you give us your details, we'll tell you how much to worry... with better accuracy.

I got 105 on the first and 125 on the second...

[Retireatee1]

I got 105 on the first and 125 on the second...

105 is pretty good.  I have to revise my results, I'm out to 54 to get a 100 now.  The issue is taxes, the "expenses" that you enter need to include taxes.  My results in my OP did not.  I don't like this approach as your taxable income can really jump around over the years as different sources of retirement income come online.

I solved this problem with my Retireator tool.  You enter your actual expenses, and it calculates the amount of income necessary each year to cover those expenses and any resulting taxes.

So a score of 100 appears to be very, very conservative.  This is basically a Monte Carlo simulation with no failing iterations and assuming very poor market performance (it's not clear what rates of return we are talking about here).

[Retireatee1]

I was able to calibrate my Retireator simulation parameters to match Fidelity's results:

Default Consumer Price Inflation: 5.00%
Default Annual Return on Stocks: 5.50%
Default Bond Yield: 5.25%

These decreased market returns and increased inflation push my retirement date out to age 54 (I also have a major recession modeled in 2025).  There are other combinations of stresses which can have the same effect I'm sure.

[honeybbq]

You May Need
$22,283 /mo


LMAOOOO

What did you put in to get that number? Mine is based on the expense info I put in, but I know they do have the ability to estimate. I think it depends on how far out from retirement you are.

I think it just grabbed it from my income??? I did not try to fix it - in all honestly. I just opened it and peeked around and closed it. So garbage in garbage out.  Fault is most likely mine.