Quote:
Originally Posted by billscamaros
Quote:
Originally Posted by Sieg
Just ran a conservative scenario in the Schwab's retirement planner without my wifes current income or retirement, factoring retirement age of 65, life expectancy of 80..........it's projecting a surplus of $439,000. ......
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Out of curiousity, what's your thought process to determine the "surplus"? This is the way that I've looked at it ....
I'm 52, have a mortgage, one kid in college and two more to go.
I"ll work until at least 65.
I don't believe that anything in my current lifestyle will change drastically .... yeah, I'll get the kids thru college, but something else will come up.
So, my goal for my retirement income is to have it equal to my current income. That retirement income will be a combination of SS, pensions and interest/dividends from my retirement accounts.
Is that essentially the way you guys calculate your needs? |
Bill, here's the basics of Schwab's:
-Are you including your partner? Yes/No
-Date of birth
-Retirement age
-Life expectancy
-Effective Federal tax bracket
-Current tax advantaged savings intended for retirement (IRA's, 401K, etc)
-Current annual amount of contributions to the plan
-Investment and bank account taxable savings intended for retirement
-How much do you plan to save yearly to these accounts
It then summarizes your total current retirement savings and total annual contributions.
Then asks how will your portfolio be invested prior to retirement.
-Short term (expected return 3.1%)
-Conservative (expected return 4.3%)
-Moderate Conservative (expected return 5.4%)
-Moderate (expected return 6.4%)
-Moderate Aggressive(expected return 7.2%)
-Aggresive(expected return 7.9%)
Then it asks how your portfolio will be invested after retirement.
-Short term
-Conservative
-Moderate Conservative
-Moderate
-Moderate Aggressive
Then it asks how much you plan to spend in retirement
-Percentage of your current income
-Monthly amount you will spend
-Annual amount you will spend
Then what income do you expect to receive in retirement
-Social Security
-What age you begin to receive benefits
Other Retirement Income
-Monthly amount
-One-time lump sum amount
It then gives you
-Your Projected Retirement Savings and Income
-Your Retirement Funding Needs
-Your Projected Surplus
-Likelihood of Meeting Goals Chart in percentage to projected age
That's the laymans summary. How honest and realistic you are with the data input is critical IMO.
The Schwab site and I'm sure others have some pretty valuable tools for the independents who want to quickly run and save multiple scenarios.
