One of the problem with retirement calculators is that they they express the results in the terms of "success" or "failure" and "failure" sounds like a dire situation where you end up broke and homeless like you spend mindlessly until you run out of money. In reality for you failure might mean something like you need to reduce your spending from $120K a year to $100K a year when you are 80 years old if your portfolio is not doing as well as you hoped. That is likely not really a hardship since you are not planning a bare bones retirement.I've run the numbers using a number of tools, including tpawplanner.com, firecalc and Vanguards, looking at the possibility of 50 years of retirement and all have been over 95% success rate.
Another problem with retirement calculators is typically they assume that you will live to some age like 95 which is where they get their percent of failure rate from. In your case it is implied but not stated that the results were 95% succuss if you live to be 95. Most people will not live to be 95.
This is one of the few retirement calculators which I have seen that tries to also include the chances of you living long enough to actually get into trouble.
"Rich, Broke, or Dead"
https://engaging-data.com/will-money-last-retire-early/
I did not try to play with your numbers but if there is an 80% chance that you or your spouse will not live long enough for "failure" then your 95% success rate would really be more like a 99% success rate because you would both likely be dead before you could fail.
Another major short coming of many if not most retirement calculators is that they do not take your home equity into account in their spending model. You might not want to plan on using it having a lot of home equity is a great safety net which can be tapped if you really need to.
One thing I did when I was deciding if I could retire was to vary the spending numbers that I used and to make a chart of how the success rate changed to see how sensitive the model was to that assumption. For example if use $120K as your target spending then run it again with spending numbers starting with $80K, $90K, $100K, etc until you get down to an 80% success rate.
You have an additional problem with retirement calculators when you are looking at a 45 year retirement starting when you are 50. The problem is that for a 45 year long retirement the most recent data set would be for someone who retired 45 years ago in 1980. Different retirement calculators use different starting dates for their historical date but keep in mind that when you use them you are really asking, "How would I have done if I retired between 1920 and 1980?" Keeping that in mind you should take the results with a huge grain of salt since those date ranges may not be all that relevant.
Lots of things;5. What else am I not considering?
1) Does that $120K include income taxes? You will still need to pay those in retirement.
2) Your kids should be through college and independent within 10 years. You need to focus on your likely expenses then and especially for when you are both 65 and on Medicare. When I was deciding if I could retire I made a simple spreadsheet where I had a row for each year until I would be 100 and one column was my expected expenses at different ages. I also had rows for things like healthcare insurance, mortgage, Social Security, etc and the final row was how much I would spend from my savings that year.
3) If the $120K expenses includes a mortgage payment I would take that out of the equation. Paying off a 2% mortgage does not make sense but in your calculations I would consider the loan balance to be in a separate bucket than your retirement funds. I would also look at the college costs as a separate bucket.
4) You mentioned "significant medical expenses (~20k)" so be sure to consider if those could increase or might be a sign of a reduced life expectancy for you or your spouse. If you have a kid with health issues then you may need to plan on long term support for them.
5) You did include Social Security in your post. Use this web site to see when it says the optimal time to start SS is. You can edit your post using the icon with the pencil on it to add Social Security to your post.
https://opensocialsecurity.com/
6) You are likely over analyzing it and being overly cautious. I sometimes like to turn a question around to see it from a different perspective. Instead of asking it as a "Can I retire?" type of question it would be good to instead ask the question as;
"I was just laid off and I will not be able to work again. I have a net worth of around $5 million dollars including my home equity. How can I make my retirement work with what I have now?"
Basically make up a simple spreadsheet of your finances would look in a reasonable worse case scenario if you had to stop working today.
Statistics: Posted by Watty — Sun Sep 07, 2025 11:13 am — Replies 8 — Views 1245