How to use networthify?

[Baylor3217]

The data this website asks for is a bit ambiguous:

http://networthify.com/calculator/earlyretirement?income=50000&initialBalance=100000&expenses=20000&annualPct=5&withdrawalRate=4

1) is current annual income net or gross?  Net seems logical

2) does current annual savings include 401k (both yours and your companies contributions)?

3) does current portfolio value include all "liquid" assets (401k, investments in any stock bond or mutual fund, cash in the bank)?

[iamlindoro]

1) is current annual income net or gross?  Net seems logical

Net.

2) does current annual savings include 401k (both yours and your companies contributions)?

Yes, it includes all savings which can be accessed at retirement.  The assumptions rely on you to engineer it such that you can continuously get money out at your desired withdrawal rate.

3) does current portfolio value include all "liquid" assets (401k, investments in any stock bond or mutual fund, cash in the bank)?

I believe the intention is that it is all liquid (or liquidatable) assets excluding real property.

[arebelspy]

And keep in mind that Networthify is a tool to give you an approximate range, and works best if you have a ways to go.

There are plenty of times it doesn't make sense to use - See lindoro's idea that you use net pay and count company match.  Now think about the case where you spend less annually than your company match.  It will say you're FI, though clearly you aren't.

100k net income, 17k spending, but 17k match = 100% savings, you're instantly FI!  Heh.

www.cfiresim.com is a tool that may be more useful if you want to get more specific.

But networthify and the like are neat when you first get started and have 5+ years to go, especially to see the impact of how saving more and spending less will reduce your time to FIRE.

[PeachFuzzStacher]

Please also note - this tool assumes that your expenses will be the same throughout.  You'd likely be spending much less by the time you're retired if you're currently paying a mortgage and commuting.

[arebelspy]

Please also note - this tool assumes that your expenses will be the same throughout.  You'd likely be spending much less by the time you're retired if you're currently paying a mortgage and commuting.

Or spending much more - I expect my FIRE budget to more than double (adding in lots of traveling + kid(s)). Either way though, you're correct in that the flat expense assumption is another limitation.  :)