FireCalc vs Personal Capital HELP...

[John122]

Which retirement platform is more believable or correct?

When I put in my numbers the in exact same way I get 96% for FireCalc and 82% for Personal
Capital.... confused am I....
Age 54 looking to retire @55 if possible
These are the #'s I plugged into both....
600,000 in investments ( mixed between taxable and Ira's)
12,000 for social security at age 62 or 2025, DW will get 6,000 in 2029 I believe it will be there for us cause we are much older than the rest of you youngsters
We will sell our small business next year for 40,000
That's it in a nut shell, am I doing something wrong?

[John122]

Forgot to put in... we need 36,000 a year to live on..

[DarkandStormy]

I don't know the FireCalc, but I'm guessing they are basing it on your current asset allocation and running various scenarios.

Does DW work?  Will you continue to do part-time work?

Either way, you'll live off of ~$600k (solely) for 7 years based on my understanding.  It depends on your SWR - that is, are you comfortable with a ~6% withdraw rate for those 7 years (ignoring the cash, I guess...so more like 5.6%)?  This is ignoring inflation.  It depends a bit on your AA, but you can play it out.  https://personal.vanguard.com/us/insights/saving-investing/model-portfolio-allocations

So with $600K next year (ignoring this year's returns or remaining contributions) I put you in a very conservative 30/70 allocation and took 7.2% non-inflation adjusted rate of return.  I then plugged in your $36K of annual expenses for 7 more years (before S.S. kicks in) and adjusted each year for 3% inflation (perhaps a bit high but better to be conservative).  From there, I reduced the expenses you're pulling from the stash by $12k for 4 years.  I then cut out your wife's $6k S.S. income in 2029.  I kept adjusting for inflation on those expenses by 3% annually and kept your investment returns at 7.2%.  Your stash in 2034 would be ~$725k (and growing).  So if you can put your stash in an AA that averages 7% returns every year, you'll be in great shape.  Congrats!

[DarkandStormy]

So if you can put your stash in an AA that averages 7% returns every year, you'll be in great shape.  Congrats!

Assuming average market returns can be risky.  There's a reason very few financial advisors would advocate a 6 or 7% withdrawal rate, especially as an initial draw down.  The problems happen when you start out drawing down your investments during a market decline.  a 6% withdrawal rate during such an event runs the risk of running out of cash.

If you ignore the S.S. benefits coming, then yes I'd agree.  The thing is, somewhere in the range of 40-50% of their annual expenses will be covered by S.S. in 2029 if I understand correctly.

[John122]

If it weren't for SS kicking in I would never consider Fire.... I am planning on working part time for the next 2 to 3 years. We have owned our business for 35 years, and we never have time to travel, life is short but I know being broke in retirement doesn't sound like fun either..
Ss will cover 50% of our expenses, and I estimated on the low end.

[DarkandStormy]

^I missed the selling business line earlier.  I'd say FIRE when you're comfortable - you should be fine in a year or two.  That part-time work you mention will help offset things, of course.  But yeah, you don't need a true 4% SWR forever with S.S. coming soon.  My personal opinion is FIRE but research some more / seek financial advice if you don't feel 100% comfortable doing it.