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Fidelity Retirement Analysis

I have a Fidelity account, and have been trying to utilize their Retirement Analysis Tool in their Planning & Guidance Center. Does anyone else have any experience with this tool? There are several area I find particularly confusing. 

Under the option "In This Market" you can select 1. Significantly Below Market 2. Below Market or 3. Average .... It explains that choosing "Average" would mean a 50% confindence level of estimated future balances and/or future income. If you select "Significantly Below Market" that means you would have a 90% confindence level of estimated future balances and/or future income. Does this mean that if I choose "Signigicantly Below Market" that I don't really expect much return all thru my retirement years???    

The other option I don't understand is under "Display Settings" .... I can select between 1. Today's Dollars and 2. Future Dollars.

I anyone else has experience with, or an opinion of this tool, would you please share?

Jody

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Follower ○○

Re: Fidelity Retirement Analysis

I have accounts at fidelity also and have used the retirement analysis tool in the past. I had issues at one time when they changed full view and importing some accounts to update to their planning tool. I also have accounts at vanguard and others that I find their service insufficient. The best one for me so far has been Personal Capital. I imported all of my accounts(social sec, ira's ,cds, pension,...etc) onto their planning service and find it fantastic. It is easy to make changes and explore possible changes very easily. I check it daily as it also tracks my checking account. When you check the financial planner it tells you if your desired monthly amount is doable and also gives a projected number with the same variables as fidelity on average and below average market returns.Overall it is easy to import, navigate,update,understand you complete financial portfolio.

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Re: Fidelity Retirement Analysis


@austchop wrote:

I have accounts at fidelity also and have used the retirement analysis tool in the past. I had issues at one time when they changed full view and importing some accounts to update to their planning tool. I also have accounts at vanguard and others that I find their service insufficient. The best one for me so far has been Personal Capital. I imported all of my accounts(social sec, ira's ,cds, pension,...etc) onto their planning service and find it fantastic. It is easy to make changes and explore possible changes very easily. I check it daily as it also tracks my checking account. When you check the financial planner it tells you if your desired monthly amount is doable and also gives a projected number with the same variables as fidelity on average and below average market returns.Overall it is easy to import, navigate,update,understand you complete financial portfolio.


@austchop 

Sure, give your passwords to all of your banking, checking, credit cards, brokerages etc. to a one-shop free service ... I mean what could possibly go wrong?

If they are hacked will they pay damages?  

Sure, Personal Capital may provide some awesome free services.  However, Google will fill in your query of "Personal Capital how" with "Personal Capital how to delete account"  YMMV

ctyankee  

 

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Re: Fidelity Retirement Analysis

@jody49 I'll give it a try. I agree that their explanation for market conditions seems rather convoluted. For their calculations they use a similar PF to yours. I suppose this is because they need long term statistics and most PFs that one might enter don't have the history needed for their calcs. As you might have noticed, the more favorable the market conditions have a higher balance at end of life. However there is also more chance of doing worse, hence the lower confidence level. So in more simple terms, with the average market conditions there is a 50/50 chance of meeting the expectation. For the "significantly less than average market conditions" most PFs will have a lower potential end amount, but on the bright side, there will be only a 10% chance of not making the end value they came up with.

Future dollars is the actual dollar amount expected. Todays dollars are shown as a lesser amount to account for inflation. Eg. $100 in 30 years might have the buying power of $40 today.

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Frequent Contributor

Re: Fidelity Retirement Analysis

I would suggest you look at the Portfolio Visualizer tools, under Monte Carlo Simulation.  Although tools such as Fido's and Vanguard's are all inclusive, they are all based upon the same underlying concepts.  How much will you need from your portfolio after you retire and what will the stock and bond markets be doing, going forward, for the next 45 years, in your case.  I assume you are 50 years old, will retire at 65, and want your nestegg to support your standard of living for 30 years thereafter!

Looking at three tools, rather than 1 comprehensive, should help you to start grasping retirement financial concepts, where, on the day you retire, you stop being an accumulator, as you have been for 50 years, and start being a decumulator, hopefully for the remaining 30 years of your life!

Good luck.  The road is bumpy but it never is blocked!  8-))

(ElLobo, de la casa de la Toro caca grande, moving tire tread inspector on the financial road to retirement, Emeritus - ret.:c'03)

 

ElLobo, de la casa de la toro caca grande
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