For long time retirees, do you use a spreadsheet?

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flyingaway
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For long time retirees, do you use a spreadsheet?

Post by flyingaway »

When you retire, you may think 25x (or any other number) is good and you withdraw following the 4% rule (or any other method). However, after 7 or 10 years, you are likely to lose track of the numbers, or the real numbers may be different from what you expected at the time of retirement.

For long time retirees, how do you know your portfolio balance is still good? Did you create a spreadsheet at the time of retirement and check against it every year?
bikechuck
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Re: For long time retirees, do you use a spreadsheet?

Post by bikechuck »

Neither my wife or I have a pension so we live off social security and a 3% annual withdrawal rate from our portfolio.

I am old enough to be able to apply for a restricted application for benefits under my wife's work record for SS so I am pulling half of her primary insurance benefit until I reach 70 when I will apply for benefits under my own work record.

We dont do any detailed budgeting but we would begin doing so if we became unable to constrain our spending to a 3% withdrawal rate. Rick Ferri, Larry Swedroe, Wade Pfau and others make a compelling case that 3% is the new 4%.

I do track our investments in a spreadsheet to monitor and rebalance when necessary. I update the spreadsheet monthly.
Last edited by bikechuck on Sat Aug 03, 2019 5:08 pm, edited 5 times in total.
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midareff
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Re: For long time retirees, do you use a spreadsheet?

Post by midareff »

I created excel spreadsheets long before I retired in 2012 and have every transaction and every fund held since 1998. I simply do a Morningstar Portfolio export and open the main page and everything is updated. Takes maybe 2 minutes once a month to keep track of everything.
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bengal22
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Re: For long time retirees, do you use a spreadsheet?

Post by bengal22 »

I track networth. It is still going up. I don't worry about withdrawal rate. When I start RMDs and full SSA my inflow will exceed outflow. I can focus on pickleball.
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MarkerFM
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Re: For long time retirees, do you use a spreadsheet?

Post by MarkerFM »

I have a detailed spreadsheet with various spending categories and, where appropriate, tabs that include more detail. I have data going back to 12 years before I retired, and every year since. Including this year, 26 years. Every $ spend except for my wife's mad money gets tracked. I create a plan each year (don't call it a budget because it's not) and then track against actual quarterly. Why? Not because we don't have enough, we will never run out of money at even an increased spending level and poor market conditions. I do it because I'm a numbers person and enjoy seeing where the money goes. Keeping close track has led to increased spending as I realized we will be fine.
btenny
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Re: For long time retirees, do you use a spreadsheet?

Post by btenny »

I have been retired for 20 years. I keep two monthly spreadsheets. One for all my accounts added up to networth and one for asset allocation across all accounts. Each is one page of data. I cross check them against each other to verify the numbers. I update them about 4 times a year. Then at year end I also compute what I withdrew from my investment accounts and spent. I use all this data in a third spreadsheet that computes my annual return.

I rebalance using the asset aĺlocation spreadsheet. I invented these spreadsheets after I retired when i fired my adviser.

God luck.
Housedoc
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Re: For long time retirees, do you use a spreadsheet?

Post by Housedoc »

Retired 10yrs, not that long but I don't keep a spreadsheet nor have a line item budget. My wife chuckled when I showed her some of the detailed budgets some keep. I take a monthly snapshot of VG and other banking accounts.
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Re: For long time retirees, do you use a spreadsheet?

Post by Dinosaur Dad »

Not retired yet...but we've kept spreadsheets detailing expenses for years, dating back to when we were looking at buying our first house and I wanted to get a handle of things. Fast forward, now it really helps in looking at a spending plan for retirement, as well as tracking investments, rebalancing, and looking at various scenarios under different market conditions. Full disclosure: I'm in market research so I'm sort of used to this type of thing. But it's not hard at all.
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retiredjg
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Re: For long time retirees, do you use a spreadsheet?

Post by retiredjg »

flyingaway wrote: Sat Aug 03, 2019 4:48 pm For long time retirees, how do you know your portfolio balance is still good? Did you create a spreadsheet at the time of retirement and check against it every year?
I've been retired 12 years. I'm an old fogey. Can do a simple spreadsheet if I need to but usually find paper and pencil easier.

When I retired, I noted what 4% of my portfolio was. Then almost immediately came the great bear market which started in 2007 which threw everything into a tizzy. I just tried to spend less money for awhile.

There is no need for a spreadsheet and checking against it every year. You look at the balance and know if you can spend extra or not.
Smoke
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Re: For long time retirees, do you use a spreadsheet?

Post by Smoke »

Nope, not any longer, it was useful to me prior to retiring 15 yrs ago.
Gave me the assurance to retire when the time came without worry.
Just enjoying retirement my way knowing that all my ducks were set up in a row before and now they keep marching on. :sharebeer
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Gnirk
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Re: For long time retirees, do you use a spreadsheet?

Post by Gnirk »

Retired 13 years ago, and I maintain excel spreadsheets detailing our finances from month-to-month. We don't have a formal budget, but instead keep track of our bottom line.
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tennisplyr
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Re: For long time retirees, do you use a spreadsheet?

Post by tennisplyr »

Retired 8 years and am not wildly structured. Sure I keep an eye on my total portfolio and my AA but no spreadsheets. I really don't want to get bogged down with monthly or yearly numbers, life is too short. :happy
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fourwheelcycle
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Re: For long time retirees, do you use a spreadsheet?

Post by fourwheelcycle »

In my early forties I developed my first Excel workbook with one sheet that listed all of our savings by institution, account number, and balance, for our personal and work-related savings. In my fifties I added a linked second sheet that projected our non-tax expenses, personal and work-related savings balances, work-related and 1099-DIV income, taxes, and net savings for each year out to age 100.

When I retired at age 60 I added a linked third sheet that projected our SS income and RMD withdrawals by year, from age 66 to 100. The income amounts from the third sheet are linked back to new SS and RMD income columns in the second sheet.

Now that we have reached age 70, with my wife finally retiring and both of us starting Medicare next year, I have had to add a new expense column for IRMAA taxes!
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Re: For long time retirees, do you use a spreadsheet?

Post by JBTX »

In an Era where the market keeps going up and up I guess the need to track closely seems irrelevant. I suspect in a protracted downturn people won't stick with their original 3-4% inflation adjusted withdrawal either. They will adjust downward.

I'm not there yet but I'd probably try to stick to 3% of current balance prior to 70 (maybe 4 if the market tanked badly) then by 70 use the RMD withdrawal rate as a maximum.
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Re: For long time retirees, do you use a spreadsheet?

Post by rossington »

If you have Office 365 Excel has an Investment Tracker template you can download. It will update your investments in real time and also track your asset allocation target vs. your actual portfolio. You can tweak it in many different ways.

In my opinion Vanguard does an excellent job of detailing all aspects of investment transactions.
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Peter Foley
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Re: For long time retirees, do you use a spreadsheet?

Post by Peter Foley »

I created an income/outflow spreadsheet about a year before the great recession (so 2007 - 2009ish). It projected spending, pension income, and a planned delay in taking SS benefits. I retired in 2012 and still use the same spreadsheet.

I have an additional spreadsheet that tracks investments by account type (taxable, tax deferred, Roth) - basically for AA purposes. That spreadsheet has a tab for "after tax" AA and another tab for net worth. So I have about 10-11 years worth of data.
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FiveK
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Re: For long time retirees, do you use a spreadsheet?

Post by FiveK »

flyingaway wrote: Sat Aug 03, 2019 4:48 pm For long time retirees, how do you know your portfolio balance is still good?
Quicken, which downloads from our brokerage accounts.
littlebird
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Re: For long time retirees, do you use a spreadsheet?

Post by littlebird »

No, but I’m from the pencil and paper generation. And - I live on income and only withdraw from assets for capitol purchases. Plus, after 31 years of retirement, I have a pretty good mental picture of assets, income and expenditures. A pencil and paper annual net worth statement does me just fine,
DecumulatorDoc
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Re: For long time retirees, do you use a spreadsheet?

Post by DecumulatorDoc »

Retired 4 years ago. Once I learned how to do spreadsheets, created two. One for portfolio holdings and allocation that updates itself. Easy to see where I'm overweight for withdrawal decisions. The other is a monthly budget and cash flow spreadsheet. Very nice to be free of the pencil, paper, and calculator.
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Re: For long time retirees, do you use a spreadsheet?

Post by penumbra »

Retired 7 years. Assets have increased since retiring. Fidelity Full View does a good job of keeping track of accounts. Used to keep meticulous spreadsheets, but came to conclusion it was wasting my time. Tracked expenses on Mint for a while, but don’t bother any more. We know the rhythm of our spending, and with increasing assets, I’m trying to spend more, not less. But then, kids are very helpful with that. 😉
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Re: For long time retirees, do you use a spreadsheet?

Post by scrabbler1 »

I have several spreadsheets relating to my finances. Some of them include detailed data for each mutual fund I own, tracking every transaction I have made with them. Other spreadsheets look at the bigger picture, showing total balances by month (or by quarter). Another spreadsheet looks at my projected cash inflows and outflows for a given calendar year, like a "projected" checkbook register. Most of these spreadsheets existed well before I retired 11 years ago at age 45.

But in the year or so leading up to my ER in late 2008, I created another spreadsheet which did a review of my expenses and projected my expenses and investment income from age 45 to age 65, focusing a lot on the years from 45 through 60 when I would have to live only on my taxable account, not my IRA or any other income or asset source not available until I reach a certain age. As I age, I adjust this spreadsheet to replace projected numbers with actual ones, so the projections going forward change.
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Re: For long time retirees, do you use a spreadsheet?

Post by AlohaJoe »

flyingaway wrote: Sat Aug 03, 2019 4:48 pm For long time retirees, how do you know your portfolio balance is still good? Did you create a spreadsheet at the time of retirement and check against it every year?
Yes, I have a spreadsheet. I can easily imagine situations where retirees don't need a spreadsheet, so I don't think it is universally required or anything. For my personal situation, I prefer to have a spreadsheet, especially since it can handle assets in multiple countries & currencies, which the free online things like Vanguard portfolio view or Mint can't.
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Re: For long time retirees, do you use a spreadsheet?

Post by Sconie »

I don't use a spreadsheet, but rather, a medium-sized, hand-written, "investment Book" in which, at the end of each month, I track my/our investment portfolio, asset allocation and the like. It is a very simple process---not very complex or sophisticated----but it works.

In a different section of this same book I track spending from our discretionary-escrow account. Similarly, a monthly recap is performed.
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Re: For long time retirees, do you use a spreadsheet?

Post by carolinaman »

I use a spreadsheet to keep track of our portfolio but since we live off of our SS and pensions, I do not have to use a spreadsheet for spending, withdrawals, etc. I do update our net worth statement every year.
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Re: For long time retirees, do you use a spreadsheet?

Post by bertilak »

I have a spreadsheet to keep track of my investments. It is easy to keep up to date because I can download the raw data from Vanguard with a few mouse clicks. All my investments are with Vanguard which helps keep it simple.

The spreadsheet:
  • Summarizes the data across 4 Vanguard accounts: two taxable and two IRA.
  • With 5 funds that's 20 possible combinations in a grid (4x5).
  • Shares and $ value are shown for each of those 20 combinations.
From the above, the overall AA is calculated and compared to my desired AA.

There is another 4x5 grid where I can propose changes (+/- dollars) and see how the results compare to my desired AA. There are checks to keep my proposed changes sensible (i.e. total value of each account is unchanged).

Quicken keeps track of income, expenses and holdings in all (not just investment) accounts. It and the spreadsheet can be eyebaled to be sure everything is consistent.
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Re: For long time retirees, do you use a spreadsheet?

Post by SQRT »

I have been retired for 13 years, aged 69. I have spreadsheets for almost everything. I track all my investments monthly since long before I was retired. Track all cash flows and expenses. Forecast cash flows out for 3 years into the future. Monitor dividends, and yield. Draw down rates (although these aren’t as important as portfolio values). All tax cost bases, capital gains and income taxes.

If it involves numbers, I have a spreadsheet for it. My weight, workouts, Christmas gratuities, home renovations, IRR’s, etc. A little overboard perhaps but being an accountant, it’s just how I do things. My spouse is the same. We’d be lost without them.
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Re: For long time retirees, do you use a spreadsheet?

Post by is50xenough »

btenny wrote: Sat Aug 03, 2019 5:39 pm

God luck.
This sounds like strong mojo.....;)
Dandy
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Re: For long time retirees, do you use a spreadsheet?

Post by Dandy »

I use 2 spreadsheets:

1. I run almost all expense payments through one checking account. I have a spreadsheet with about 25 categories of expense e.g. Real Estate Taxes, Gas and electric, one for each credit card, health insurance, etc. I post monthly to get an idea of my monthly and ytd expense run rate.

2. Each month I post the end of month values for all investment and savings holdings. It calculates the allocation for each type of account e.g. TIRA, joint taxable, Roth etc as well as for the total assets. I roughly follow Dr. Wm Bernstein's idea of having enough "safe" assets to fund retirement until age 90. The spreadsheet does that calc also.

These spreadsheets were very useful in early retirement to get a handle on retirement expenses and asset adequacy. It has become more of a habit than a necessity now that we both have collected our Social Security and Pensions. Of course a long bull market tends to ease much of those early concerns also.

I don't use the spreadsheets to determine how much I should withdraw. Being a lifetime frugal couple (maybe cheapskates :) that is not a major concern.
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Re: For long time retirees, do you use a spreadsheet?

Post by hudson »

Spreadsheets are amazing compared to my father's paper spreadsheets. Learning spreadsheet skills in the MS DOS days was difficult, but the payback has been great.

On my main spreadsheet, I don't track detail. I just track the totals and grand total of my four investment locations. I don't want to double track what Vanguard has. My goal is to see if I'm on track; am I over-spending?

I have a column that shows 3% of my total holdings. Another column divides that by 12 to show potential monthly income.

I have a few columns that show how long X dollars would last if I just drew down the holdings...without any interest or gain.

I use an older version of longvest's vpw spreadsheet every 6 months or so to see where I am. I don't use the VPW spreadsheet like longvest intended. I just start over and do one year; I'll repeat the next time that I want to look. Thanks longvest!

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Re: For long time retirees, do you use a spreadsheet?

Post by MikeG62 »

flyingaway wrote: Sat Aug 03, 2019 4:48 pm When you retire, you may think 25x (or any other number) is good and you withdraw following the 4% rule (or any other method). However, after 7 or 10 years, you are likely to lose track of the numbers, or the real numbers may be different from what you expected at the time of retirement.

For long time retirees, how do you know your portfolio balance is still good? Did you create a spreadsheet at the time of retirement and check against it every year?
I think what you are asking is how much have our withdrawals changed over time (if at all) as a result of changes in the underlying portfolio value?

First, we are following a modified version of Guyton & Klinger's withdrawal decision rules. So we started at an initial withdrawal rate (in low 3% range) with a plan to increase the dollar amount of our withdrawals by inflation. In our first two years of retirement we significantly underspent our budget (largely due to underspent of T&E), so we did not implement the inflationary increases. We got much closer to our budget level spend in our 3rd year of retirement, so we build in the inflationary increase in this (our 4th) year of early retirement.

Second, our portfolio value has increased over the four years (with the rise in the markets). So our withdrawal rate has fallen as a % of our current portfolio value. This I think is the crux of your question. Our plan does contemplate step changes in our annual WD amount, but we have not hit them so far. These step changes result from following the Prosperity and Capital Preservation Rules under G&K's methodology. More specifically, should our current annual WD rate (as a % of our current portfolio value) fall below or rise above certain predetermined thresholds, we would update (increase or decrease) our annual WD amount by +/-10%. G&K set their tripwires for these step changes symmetrically at a +/-20% increase/decrease in the WD rate. Our thresholds are customized (larger change required to trip the Capital Preservation threshold, which would result in a 10% reduction in our annual WD amount, than the Prosperity threshold, which would result in a 10% increase to it) since we are starting with a different (much lower) initial WD rate than G&K used in their modeling. This is similar to the "ratcheting" methodology that Kitces has written about.

Hope this is on point with you question and helps answer your question (at least as far as what we are doing).
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RadAudit
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Re: For long time retirees, do you use a spreadsheet?

Post by RadAudit »

flyingaway wrote: Sat Aug 03, 2019 4:48 pm For long time retirees, how do you know your portfolio balance is still good? Did you create a spreadsheet at the time of retirement and check against it every year?
I retired about nine years ago. I use to keep track of the portfolio balance vs. the IPS targets on the back of an envelope. Somewhere along the line, I got even lazier than I use to be. Set up a simple (very simple) spreadsheet that does the same thing. Now, I just input the fund balances and the computer kicks out the percentages, matches them against the IPS targets, and lets me know how much to move between accounts if I want to rebalance.

I'm slowly edging towards deciding to go with an essentially single fund portfolio. Then, I can reduce the workload (ha!) even further.

But to answer the question, I don't know if the portfolio balance is good. I do know that it is real close to IPS targets after I rebalance every year or two. And to latch on to MikeG62's comment, I'm reinvesting the difference between RMDs and SWRs, after taxes. The SWRs are set at 3%+ inflation. And, the portfolio balances - thanks to a 10 year run up - are behaving better than initially planned. I may change the SWR at some point in the future.
Last edited by RadAudit on Sun Aug 04, 2019 8:00 am, edited 1 time in total.
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Re: For long time retirees, do you use a spreadsheet?

Post by DetroitRick »

Yes. I use Quicken for current year income/expense/withdrawal control, and as a source of historical info for planning. I use Excel spreadsheets for both long-range planning and portfolio balancing. I've always used the Quicken tool, but spreadsheet usage has changed since initial retirement (when I primarily funded from cash). I actually use the planning spreadsheet tool more now than I used to.

Currently, once yearly, I plan detailed inflows for the next decade and summary-level outflows on a spreadsheet. This is where I plan expected portfolio withdrawals, particularly for the next several years (I don't use a fixed withdrawal rate). At that point, I evaluate the prior plan to make sure my planning continues to be realistic. And I do short-term tax planning simultaneously from the same data. Then, during the year, I mainly use Quicken to tell me how I'm doing.

I suspect I will do a lot less of this when I reach the point that inflows (SS, pensions, spouse wages, other income) are not so variable year-to-year. For now, I feel the need. And it's not as much work as it all sounds, the Quicken stuff is nearly all automatic, and the long-range planning gets easier with time and experience. The spreadsheet stuff is pretty much an afternoon of my time, once per year. And some limited interim monitoring. Wife is involved with both, but primarily interacts directly with Quicken.
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Re: For long time retirees, do you use a spreadsheet?

Post by Stinky »

Retired less than a year, but have a spreadsheet that I should be able to maintain for many years.

Besides tracking individual fund positions and giving totals and consolidated allocation percentages, it compares our spending to the "3% rule" (conservative version of the 4% rule). So far, we're below the 3% threshold.
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Re: For long time retirees, do you use a spreadsheet?

Post by Ron »

You can call me a "spreadsheet wonk", since I worked in a position that did business statistical analysis for many years, starting out with Lotus 1-2-3 and then on to Excel.

I didn't start tracking my personal investments until I retired, in early 2007. I also did not concern myself with really looking at withdrawal rates, beyond what was shown on the FIDO RIP (Fidelity Retirement Income Plan) which showed that we would be OK up through age 100. I did a rough calculation on my own using a 6% real return on the market vs. planned retirement expenses on a simple spreadsheet, and that also passed the "retirement ready" test.

As far as looking at withdrawal rates early in retirement? I/we did not overly concern ourselves since all our income sources were not available on day one of each of our retirements. To measure it then would not show the true total retirement financial picture, long term. I retired at age 59, with no income (beyond a small VA disability) other than my investments. No pension, no SS. If one would look at the value of our joint holdings during the 2008-09 downturn vs. our retirement expense withdrawals, we certainly were above the 4% "rule", but then again we've been saving/investing for retirement since 1982 so we were well aware that what was the current reality of the market, good or bad, would not be the same, forever.

My wife retired at age 64, a year before her two small pensions would start and at least two years before her FRA age 66 SS was planned. She also was living using savings/investments in her early retirement.

As it turned out, when we finally did start getting all our retirement income "on-line" at age 70 (when we both started our respective SS), we did not need to withdraw much other than what was required by the federal government via RMD's. As it is, the RMD's vs our retirement investments for the last three years (two actual / one forecast - a/o Friday's market close, to become actual on Dec 31'st of this year) are 3.116%, 3.163%, and 3.163% of our joint retirement investments, well below the suggested 4% and closer to the "new normal" 3% withdrawal rate. In reality, the entire RMD is not needed for retirement expenses. Part is used to pay for taxes on the RMD and all other retirement income (e.g. SPIA, SS, pensions) with the remaining being used for "fun" (like business class travel), and the remainder going into savings for "what if" situations. We don't really look to invest the remaining in taxable accounts.

All these calculations were done - either forward looking or backwards history, using the facilities of a spreadsheet. For us, it made retirement income/expense tracking much easier.

FWIW,

- Ron
Northster
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Re: For long time retirees, do you use a spreadsheet?

Post by Northster »

I use a Google sheet that pulls fund prices from Google Finance. In addition to tracking portfolio total it also tracks asset allocation so I can easily make adjustments as needed. I do an update quarterly or when trades are made.
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Re: For long time retirees, do you use a spreadsheet?

Post by Broken Man 1999 »

tennisplyr wrote: Sat Aug 03, 2019 6:29 pm Retired 8 years and am not wildly structured. Sure I keep an eye on my total portfolio and my AA but no spreadsheets. I really don't want to get bogged down with monthly or yearly numbers, life is too short. :happy
Very much the same, no spreadsheets for us.

I certainly know the state of our retirement portfolio, and the market. Notice I said state, not direction! I also know what expenses we pay each month. Beyond that, not sure anything else would be useful to us. We have what we have. We spend what we spend.

We have never used spreadsheets, or formal budgets when working. It didn't require being a rocket scientist for us to know if/how/when we should do things outside of regular and routine expenditures.

We have lived below our means our whole marriage, 48 years in November.

I'm sure many find comfort in having a precision snapshot of their finances, but my experience tells me no matter how precise your budget might be, life happens. Life doesn't care a whit about you and that budget. Life isn't precise, no matter how precise your accounting of it might be.

The nice thing about LBYM is you can take the punches and body blows life deals you, without being knocked out. And, when you have a mind to, you can splurge on something entirely frivolous, occasionally.

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Re: For long time retirees, do you use a spreadsheet?

Post by RudyS »

Broken Man 1999 wrote: Sun Aug 04, 2019 2:07 pm
tennisplyr wrote: Sat Aug 03, 2019 6:29 pm Retired 8 years and am not wildly structured. Sure I keep an eye on my total portfolio and my AA but no spreadsheets. I really don't want to get bogged down with monthly or yearly numbers, life is too short. :happy
Very much the same, no spreadsheets for us.

I certainly know the state of our retirement portfolio, and the market. Notice I said state, not direction! I also know what expenses we pay each month. Beyond that, not sure anything else would be useful to us. We have what we have. We spend what we spend.

We have never used spreadsheets, or formal budgets when working. It didn't require being a rocket scientist for us to know if/how/when we should do things outside of regular and routine expenditures.

We have lived below our means our whole marriage, 48 years in November.

I'm sure many find comfort in having a precision snapshot of their finances, but my experience tells me no matter how precise your budget might be, life happens. Life doesn't care a whit about you and that budget. Life isn't precise, no matter how precise your accounting of it might be.

The nice thing about LBYM is you can take the punches and body blows life deals you, without being knocked out. And, when you have a mind to, you can splurge on something entirely frivolous, occasionally.

Broken Man 1999
Same situation/approach for us. 58 years of marriage, and 17 years of retirement. All that time of LBYM (LBOM actually) left us comfortable enough not to have to worry about a budget, etc.
michaelingp
Posts: 389
Joined: Tue Jan 17, 2017 8:46 pm

Re: For long time retirees, do you use a spreadsheet?

Post by michaelingp »

Retired 6 years. I have a spreadsheet that I've enhanced over the years to track my investments. "Track" is not really the right word, it actually just reports my holdings and AA at any one time. I update it manually which doesn't take much time every couple of months. I can use it for rebalancing since it shows how far off from my AA I am. Honestly it's not very sophisticated, but it tells me what I need to know, it's within my Excel skill set, and it's free and I don't have to share personal information with anybody.

The only other spreadsheet I maintain tracks medical expenses and reimbursement. That's more of a curiosity/hobby thing, not really actionable. It lets me compare how much I pay for, say, dental insurance compared to the benefits of that insurance. It would be useful if I were anywhere near the limits for tax deductions for medical expenses, but, thankfully, I'm not. It shows me, for example, that the benefit I get from the insurance company's negotiated rates with providers saves me much more than the actual cash benefits the insurance company pays.
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