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Leaving Money Behind?

 

Bill Hines, Retirement Planner
(@hines202)
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Is there an input anywhere to indicate a desire to leave $xxx behind? For example, if a couple have two kids and want to leave them each at least $250k, would there be a way to indicate that, and have the probabilities of success factor that in?

So, rather than 90% probability of success of never running out of money, it would indicate 90% of leaving that floor amount behind?

Maybe as a minimum baseline/floor amount in a specific category, such as a Roth (which is an optimal way to leave money behind since it won't be taxed to heirs and they can leave it in there without the 10-year clock ticking as it does in traditional accts)

Bill Hines
Financial Counselor/Retirement Planner
Money Coach Group, Inc
https://moneycoachgroup.com
bill@moneycoachgroup.com


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Bill Hines, Retirement Planner
(@hines202)
Eminent MemberCustomer
Joined: 3 months ago
Posts: 45
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Topic starter  

I'd also like to see this when doing consumption smoothing, i.e. how much more can someone spend while still meeting that goal of leaving some money behind.

Bill Hines
Financial Counselor/Retirement Planner
Money Coach Group, Inc
https://moneycoachgroup.com
bill@moneycoachgroup.com


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Stuart Matthews
(@smatthews51)
MemberAdmin
Joined: 7 months ago
Posts: 125
 

@hines202 No, there is currently no capability for the user to specify a legacy amount; however, I agree that this would be a nice product enhancement and I've added it to the list for PRC2022. Thanks!


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Bill Hines, Retirement Planner
(@hines202)
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Joined: 3 months ago
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I'm wondering if a way to simulate this would be to put in a $500k 'expense' for one of those final years of life? I.e. if I'm setting it up for a longevity of 95 years, put that in for age 94? Then the chances of success, percentiles, etc would factor that in?

Bill Hines
Financial Counselor/Retirement Planner
Money Coach Group, Inc
https://moneycoachgroup.com
bill@moneycoachgroup.com


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Stuart Matthews
(@smatthews51)
MemberAdmin
Joined: 7 months ago
Posts: 125
 

@hines202 Yes, indeed, that does seem to work! I just ran a couple of tests with the Monte Carlo consumption smoothing algorithm and it works well to fund that $500K expense in the next-to-last year and finish with a 90% probability of success!


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Bill Hines, Retirement Planner
(@hines202)
Eminent MemberCustomer
Joined: 3 months ago
Posts: 45
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Topic starter  

Great news! Mark that 2022 feature as completed, and update the manual 🙂

Bill Hines
Financial Counselor/Retirement Planner
Money Coach Group, Inc
https://moneycoachgroup.com
bill@moneycoachgroup.com


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