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  #11  
Old 04-24-2018, 01:16 PM
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George Frankly George Frankly is offline
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Originally Posted by Klaymen View Post
My spreadsheet has the balance of my various accounts, how much will go in them each year,

(e.g. 401k $18K + 9% matching, Roth $5.5K, HSA $6K)

and the long-term rate of investment return which for most of them I now assume to be 6%. Then I have an idea for how much I project to have each year, and from there you multiply by 4% to get your annual withdrawal. Take that number and discount back to what that is worth today. Then add in social security or other pensions.

I think it would be much less practical to say that in 5 years I made it to 5% of the goal because that is clearly not a linear function with compounding going on.
This is pretty much what I have, but I haven't built it up enough I'd want to share it. Y'all would just laugh at it. I probably spent all of 90 minutes cobbling it together.

The big assumption is rate of return, and if I could predict that I'd be in a different line of work. So given that, I try not to over-complicate the thing. I track my accounts separately, same as you, and then I added on the mortgage and home equity. So I have about the same basic inputs. The $$$ contributions per account, a growth rate for contributions (I assume I will save more over time), rate of return (I typically put in 5%, as a real return vs nominal).

In terms of focus, I put more energy into getting dollars into savings/investments, and don't sweat the 20Y forecast all that much. And I do like firecalc, mentioned above.
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  #12  
Old 04-24-2018, 02:08 PM
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Originally Posted by George Frankly View Post
This is pretty much what I have, but I haven't built it up enough I'd want to share it. Y'all would just laugh at it. I probably spent all of 90 minutes cobbling it together.

The big assumption is rate of return, and if I could predict that I'd be in a different line of work. So given that, I try not to over-complicate the thing. I track my accounts separately, same as you, and then I added on the mortgage and home equity. So I have about the same basic inputs. The $$$ contributions per account, a growth rate for contributions (I assume I will save more over time), rate of return (I typically put in 5%, as a real return vs nominal).

In terms of focus, I put more energy into getting dollars into savings/investments, and don't sweat the 20Y forecast all that much. And I do like firecalc, mentioned above.
yeah, put the effort into this.
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  #13  
Old 04-26-2018, 04:26 PM
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Here is one from the Society of Actuaries.

https://www.soa.org/tables-calcs-too...-beta-version/
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  #14  
Old 04-27-2018, 02:06 PM
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Fair. I like to give more detail than needed, but it’s still a back of the envelope calculation. If it took 10 years to reach 25% of the goal, and I was at 20% of the goal a year ago, Method 1 says retirement is 30 years away. Method 2 says retirement is 15 years away. I know a million different variables impact this, which is why I’m looking for something better: either something that allows me to model the more important variables, or something that does a better job at the back of the envelope calculation. I know retirement is still a far way off, but I still think there’s value tracking things along the way like you’d track any other long term goal.
Sure, set a goal, and track it. Adjust goal as time goes on. I just wouldn't get too granular. Here's what I do: Take my current savings and apply an annual rate of gain on it for x year. Then I add in how much additional I think I can save for those x years and apply the same rate of gain for the appropriate number of years. If I don't like the result, I adjust x. If I can't get to a number I like by adjusting x to a number I also like, then I modify how much I'm saving.

But that's me. I don't like complicated models.

ETA, I see i've been ninja'd a couple times.
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I think the dollar will crash irreparably by 2012.... bottom drops out of the dollar. ....Dollars are worthless, 401ks are bust, the markets are valueless...government assumes control over all industry and everything is nationalized by the end of 2012. - gomer_tree

Last edited by The Drunken Actuary; 04-27-2018 at 02:24 PM..
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