Author Topic: My favorite retirement planning tool is...  (Read 1590 times)

SeattleCPA

  • Handlebar Stache
  • *****
  • Posts: 1600
  • Age: 60
  • Location: Redmond, WA
    • Evergreen Small Business
My favorite retirement planning tool is...
« on: January 17, 2019, 08:22:48 AM »
I'm a long time fan of most of the popular retirement planning tools.

E.g., I love the way that firecalc and especially cfiresim let us explore the worst-case historical scenarios, variable withdrawal rates and even crazy ideas like using financial leverage.

I have wasted invested hours playing modeling different asset allocation formulas with Portfolio Visualizer

I just love what Tyler does at his PortfolioCharts website.

But I think I have a new favorite tool for thinking about safe withdrawal rates, the impact of asset allocation on failure rates and related topics: The Google Sheets spreadsheet provided at Early Retirement Now, which is available here:

https://earlyretirementnow.com/2018/08/29/google-sheet-updates-swr-series-part-28/

I don't see or have simply missed discussions of this powerful planning tool here... but folks probably want to know its there.

Also I'd be curious if anybody here has other favorites--I'm sorry I didn't know about the ERN spreadsheet until recently. What else am I missing!?

ysette9

  • Walrus Stache
  • *******
  • Posts: 6986
  • Location: Bay Area, CA
    • The Best Is Yet To Come
Re: My favorite retirement planning tool is...
« Reply #1 on: January 17, 2019, 01:47:03 PM »
Holy crap, that looks in-depth. I should bookmark this for later perusal. For now I use cFIREsim and even that took me a while to figure out how to use correctly. How do you find the learning curve for this tool?

ILikeDividends

  • Bristles
  • ***
  • Posts: 459
Re: My favorite retirement planning tool is...
« Reply #2 on: January 17, 2019, 02:59:12 PM »
Also I'd be curious if anybody here has other favorites--I'm sorry I didn't know about the ERN spreadsheet until recently. What else am I missing!?
@MDM has generously donated his time to put together, and maintain with ongoing updates, a Case Study Spreadsheet that should, in my opinion, be an essential part of everyone's toolkit.

https://forum.mrmoneymustache.com/forum-information-faqs/case-study-spreadsheet-updates/100/

It's not for historical analysis; rather, it's for forward planning/forecasting.  Scroll to the bottom of the last page to get the latest version posted by MDM.
« Last Edit: January 17, 2019, 03:08:47 PM by ILikeDividends »

Telecaster

  • Handlebar Stache
  • *****
  • Posts: 2308
  • Location: Seattle, WA
Re: My favorite retirement planning tool is...
« Reply #3 on: January 17, 2019, 03:16:47 PM »

But I think I have a new favorite tool for thinking about safe withdrawal rates, the impact of asset allocation on failure rates and related topics: The Google Sheets spreadsheet provided at Early Retirement Now, which is available here:

https://earlyretirementnow.com/2018/08/29/google-sheet-updates-swr-series-part-28/

I don't see or have simply missed discussions of this powerful planning tool here... but folks probably want to know its there.

Also I'd be curious if anybody here has other favorites--I'm sorry I didn't know about the ERN spreadsheet until recently. What else am I missing!?

I've played around with that one a little bit.   Impressive work, no doubt.   He's assuming 2% inflation going forward, which on the low side.  If you increase the inflation rate, then the failure rate increases, but I'm not sure if that's really true because historically inflation has averaged more than 2% and presumably bond rates would increase with inflation as well.   

SeattleCPA

  • Handlebar Stache
  • *****
  • Posts: 1600
  • Age: 60
  • Location: Redmond, WA
    • Evergreen Small Business
Re: My favorite retirement planning tool is...
« Reply #4 on: January 17, 2019, 06:07:33 PM »
Holy crap, that looks in-depth. I should bookmark this for later perusal. For now I use cFIREsim and even that took me a while to figure out how to use correctly. How do you find the learning curve for this tool?

One thing that's good about ERN's tool is blog posts describe how to use.

FYI, I really like cfiresim and firecalc, but found the "help" functions in both locations a little light.

SeattleCPA

  • Handlebar Stache
  • *****
  • Posts: 1600
  • Age: 60
  • Location: Redmond, WA
    • Evergreen Small Business
Re: My favorite retirement planning tool is...
« Reply #5 on: January 17, 2019, 06:10:32 PM »
Also I'd be curious if anybody here has other favorites--I'm sorry I didn't know about the ERN spreadsheet until recently. What else am I missing!?
@MDM has generously donated his time to put together, and maintain with ongoing updates, a Case Study Spreadsheet that should, in my opinion, be an essential part of everyone's toolkit.

https://forum.mrmoneymustache.com/forum-information-faqs/case-study-spreadsheet-updates/100/

It's not for historical analysis; rather, it's for forward planning/forecasting.  Scroll to the bottom of the last page to get the latest version posted by MDM.

+1 definitely... And I didn't mean to exclude @MDM 's excellent work. (I was myopically focused on the retirement planning tools.)

SeattleCPA

  • Handlebar Stache
  • *****
  • Posts: 1600
  • Age: 60
  • Location: Redmond, WA
    • Evergreen Small Business
Re: My favorite retirement planning tool is...
« Reply #6 on: January 17, 2019, 06:13:33 PM »

But I think I have a new favorite tool for thinking about safe withdrawal rates, the impact of asset allocation on failure rates and related topics: The Google Sheets spreadsheet provided at Early Retirement Now, which is available here:

https://earlyretirementnow.com/2018/08/29/google-sheet-updates-swr-series-part-28/

I don't see or have simply missed discussions of this powerful planning tool here... but folks probably want to know its there.

Also I'd be curious if anybody here has other favorites--I'm sorry I didn't know about the ERN spreadsheet until recently. What else am I missing!?

I've played around with that one a little bit.   Impressive work, no doubt.   He's assuming 2% inflation going forward, which on the low side.  If you increase the inflation rate, then the failure rate increases, but I'm not sure if that's really true because historically inflation has averaged more than 2% and presumably bond rates would increase with inflation as well.

No, no, that's right. Good point.

I guess what I like about his approach, though, is you can look at various SWRs across a band of failure rates... and vice versa... Also I think his approach lets one see which the really worst case scenario is (folks who retired in 2000).

DreamFIRE

  • Handlebar Stache
  • *****
  • Posts: 1596
Re: My favorite retirement planning tool is...
« Reply #7 on: January 17, 2019, 06:36:40 PM »

I use cFireSim from time to time and have checked out some of the others as well.

For my personal use, I created my own spreadsheet for planning my drawdown from my different buckets of stash over different timelines of FIRE to keep my taxable income and MAGI within certain ranges to minimize taxes while taking advantage of ACA subsidies, then SS, then Medicare, etc.