Discretionary Retirement Spending

I would like one table that tells me and my wife, for my a given level of spending, the required smooth withdrawal rate and the effect on my assets over the time horizon. When I do this in Conventional Planning I get a huge level of spending in the current year.

Comments

It is best to use "economics-based planning" as the results will make more sense.

What you are looking for is found in the Net Worth and Total Income reports. If you divide your annual retirement withdrawals by your retirement assets in a given year, you will see the current withdrawal rate. With a minute in Excel, you can repeat this for the rest of your retirement years.

Note that the withdrawal rate may not be constant. This is due to a number of factors including RMDs and varies per profile.

Best,
Brian

Thanks, Brian. My problem may have been that the data base seems to take a while to update or refresh. Do you know how to do that?

I'm not 100% sure what you mean. Generally, as soon as you change a field it directly changes the database. There are a few exceptions where you have to hit "apply" or changing maximum age of life, etc.

Try shutting the program down and re-starting. It shouldn't take long at all to go between tabs unless there is an issue on your specific computer.

Best,
Brian

dan royer's picture

Yes, I agree with Brian. Don't bother with "conventional planning." This is more to illustrate the folly of setting your own planning target as opposed to letting the program figure it out for you.

Each time you make a change it automatically saves the database. But then you need to create a report (PDF or Excel) to see the results or impact on discretionary spending.