I actually think it might be right. You spend $500K. But you will get a pension of $50K and presumably social security of a combined $140K-$150K. That means you have a gap of $300K that needs to be funded. If your portfolio grows to $8M, it will generate $320K at 4%. That collectively is $520K per year, so a draw down rate of $500K/year would in fact cause the portfolio to increase.

So you would sell a portion of your stocks every year?

We have a sizable stock portfolio as well and would prefer to keep the capital and live off the dividends as much as possible, to preserve wealth for the next generation.

The thing is that stocks with a high capacity for growth rarely give large dividends. You want to balance growth and profit.

Are your children young enough that you’ll be receiving social security payments on their behalf during retirement? Might want to check the opensocialsecurity calculator, too.

Well, if it calculates you'll have $8m at retirement, that gives you $320k a year to spend. Plus $50k pension. Plus, I'll assume that at age 70 you get about $50k each for SS. This gets you to $470k safe spend a year. Close enough to $500k. Good for you!

Anonymous wrote:I don’t know about this calculator but I wouldn’t suggest spending 20% of your net worth each year in retirement.

What’s your annual spending look like or projected to be? You could retire tomorrow if you want.

I wouldn't suggest taking financial advice from someone with your math skills.

Here is another that I started with.
https://www.calcxml.com/calculators/retirement-calculator

It is simpler than FireCalc, but once you put in your info there is a link that allow you to see the actual numbers for each year of your retirement. If it starts off overly optimistic, you can see what you might have done wrong and correct it and redo. With Monte Carlo simulations you can't see what they are doing.

Anonymous wrote:Does it really say you can 10%? I find that difficult to believe.

Well…, it would not be 10% because the portfolio will grow to probably close to $8m (we save aggressively) and we also have a pension. But still, I share your skepticism.

Anonymous wrote:

Anonymous wrote:Hmmm, I would run it using a variety of Portfolios and Spending models.

Also, how much are you saying you will add each year before retirement? If it is a decent amount over 5 years, and you aren't touching the 5.25 until then, they probably have you significantly higher than 5.25 by the time you retire.

OP here. We add about $200k/y that I plugged into the calculator. Still, using say 5% rate of return, we’ll be about $2m shy of our original target of $10m.

Sorry, I'm confused. Originally you said it was saying you'd have tons of money. Are you now saying running it at 5% you will be shy of what you want?

Also, if you are adding 200K/year then that is an additional 1mm over the 5 years. All of which would be increasing in value assuming no major crash that stays down for an extended period of time.

Does it really say you can 10%? I find that difficult to believe.

Anonymous wrote:

Anonymous wrote:I don’t know about this calculator but I wouldn’t suggest spending 20% of your net worth each year in retirement.

What’s your annual spending look like or projected to be? You could retire tomorrow if you want.

OP here. DH and I met late in life and we still have young children

Between private school tuitions and funding their 529s, we spend a lot… No family money on either side of the family.

I thought we needed to work until we hit $10m in savings, which may reach in 10years. But FIRECalc thinks we’ll be fine in 5.

I would do the variety of How your portfolio is invested. I would also take an amount and run your numbers on that--constant spending power--under the Spending tab. I assume our spend COULD be as much later in life if we are faced with higher care and medical.

Even if you aren't adding money, your 5.25 has 5 years to grow. I doubt it would double in 5 years, but it could be significantly higher if you are 100% equities.

Anonymous wrote:Hmmm, I would run it using a variety of Portfolios and Spending models.

Also, how much are you saying you will add each year before retirement? If it is a decent amount over 5 years, and you aren't touching the 5.25 until then, they probably have you significantly higher than 5.25 by the time you retire.

OP here. We add about $200k/y that I plugged into the calculator. Still, using say 5% rate of return, we’ll be about $2m shy of our original target of $10m.

Anonymous wrote:I don’t know about this calculator but I wouldn’t suggest spending 20% of your net worth each year in retirement.

What’s your annual spending look like or projected to be? You could retire tomorrow if you want.

OP here. DH and I met late in life and we still have young children

Between private school tuitions and funding their 529s, we spend a lot… No family money on either side of the family.

I thought we needed to work until we hit $10m in savings, which may reach in 10years. But FIRECalc thinks we’ll be fine in 5.

Hmmm, I would run it using a variety of Portfolios and Spending models.

Also, how much are you saying you will add each year before retirement? If it is a decent amount over 5 years, and you aren't touching the 5.25 until then, they probably have you significantly higher than 5.25 by the time you retire.

I don’t know about this calculator but I wouldn’t suggest spending 20% of your net worth each year in retirement.

What’s your annual spending look like or projected to be? You could retire tomorrow if you want.

50/56yo with $5.25m in retirement/brokerage accounts, DH will have a pension of about $50k/y.

Trying to figure out if we can retire in 5 years. FIRECalc thinks that we are good to go as long as we spend less than $500k/year (using the Bernicke's Reality Retirement Plan that reduces the spending as one ages). Moreover, it projects us dying with possibly many millions left in our estate....

Do you think that FIRECalc is too optimistic?