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My income keeps increasing even after I retire.

Posted: Sun Nov 10, 2019 2:36 am
by StayPuft
Hi!

I just downloaded the program and am just getting a feel for it. I feel like I'm missing something, but I can't figure out what I'm doing wrong. I inputted my current taxable and tax-free portfolio values, as well as taxable and tax-free annual savings.

I put my retirement age at 65.

When I run the scenario, my income doesn't descend when I retire...it just keeps increasing. That just can't be accurate. Does it think that I'm going to keep contributing to my savings when I retire?

Thank you!

Re: My income keeps increasing even after I retire.

Posted: Sun Nov 10, 2019 8:09 am
by jimr
When you say your income keeps increasing, what output are you looking at that's telling you this?

In general, when you're seeing confusing things from the planner, it can help to set the spending policy to stable, which turns off the dynamic withdrawal feature of the program. This feature is explained in the spending policy section of the documentation here:

https://www.flexibleretirementplanner.c ... -policies/

Re: My income keeps increasing even after I retire.

Posted: Sun Nov 10, 2019 2:59 pm
by StayPuft
jimr wrote:
Sun Nov 10, 2019 8:09 am
When you say your income keeps increasing, what output are you looking at that's telling you this?

In general, when you're seeing confusing things from the planner, it can help to set the spending policy to stable, which turns off the dynamic withdrawal feature of the program. This feature is explained in the spending policy section of the documentation here:

https://www.flexibleretirementplanner.c ... -policies/
I'm using the portfolio value graph. After my inputted retirement age, I expect my total portfolio value to gradually decrease since I won't be contributing to it anymore and will be spending it, at that point. But, my graph just keeps increasing as I age. I feel like I've inputted something incorrectly and maybe it thinks I'm contributing into my portfolio until death.

I've toggled between the different spending policies, but it doesn't change it.

I'm confused. Please help.

Re: My income keeps increasing even after I retire.

Posted: Sun Nov 10, 2019 9:54 pm
by jimr
It's not uncommon for the portfolio value graph to increase throughout your plan, even as you're taking regular withdrawals.

In fact, this is often the case when you create a plan that has a typical 85% or higher probability of success. But keep in mind that the graph shows the median (50% percentile) portfolio value. This means that in half the simulation paths, the portfolio value was higher than the amount graphed, and in half it was lower.

In the detailed view tab, you can see the trajectory of the bottom 10% portfolio value (see the column called bottom 10% value). This column shows the lowest year-to-year portfolio value that was seen in 90% percent of the simulation paths.

Re: My income keeps increasing even after I retire.

Posted: Tue Nov 12, 2019 1:50 am
by StayPuft
jimr wrote:
Sun Nov 10, 2019 9:54 pm
It's not uncommon for the portfolio value graph to increase throughout your plan, even as you're taking regular withdrawals.

In fact, this is often the case when you create a plan that has a typical 85% or higher probability of success. But keep in mind that the graph shows the median (50% percentile) portfolio value. This means that in half the simulation paths, the portfolio value was higher than the amount graphed, and in half it was lower.

In the detailed view tab, you can see the trajectory of the bottom 10% portfolio value (see the column called bottom 10% value). This column shows the lowest year-to-year portfolio value that was seen in 90% percent of the simulation paths.
Okay, let me play around with it some more and see if I can figure it out. Thanks for the replies!