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This is almost very useful, but it's missing two features: 1. I want to index my passive income to inflation, meaning drawing down from principal if necessary;
by gnachman 12y ago
This is almost very useful, but it's missing two features:
1. I want to index my passive income to inflation, meaning drawing down from principal if necessary; so you'll need to know my assumption rate for inflation and life expectancy.
2. My investment return rate will change (since I'll have a lower risk tolerance) when I reach my goal.
- jrmiller_ 12y agoThanks for checking it out! Those are some good suggestions. I'll probably add them in when I have the time.
- robzyb 12y agoFun fact: The term "inflation" usually refers to price inflation. Indexing passive income to price inflation makes sense in the short term. However in the long term, especially when talking about retirement income, wage inflation (which is usually higher than price inflation) can produce more insightful results. Using wage inflation in an analysis means that you build in the increases in living that can be expected over the decades. This comment was brought to you by your local HN actuary(ial analyst).