Hi Old Joe,
I often post that everyone gets to choose their own poison.
Like you, when I was preparing for retirement, Monte Carlo codes that addressed retirement issues were not readily available. That's why I assembled my own code.
It appears to me that your spreadsheets really are a subset of what Monte Carlo analyses do. Whereas you or anyone else have limited time to complete only a small number of these calculations, a Monte Carlo tool completes thousands of what could be identical computations. And it produces these countless simulations without a bias.
The bias and simplifications assumed by any hand calculation can compromise the results. For example, you reported that you assumed fixed relationships between bond and equity returns compared to inflation rates. Why you selected those fixed values puzzle me. The historical data does not support such an assumption. Actual historical data of these outcomes vary all over the map, are not constant, and not predictable. When that is the real world situation, Monte Carlo analyses shine.
I reject your assertion that I support the invincibility of Monte Carlo. I freely acknowledge its shortcomings. Also, I never tell investors what to do. In general, I merely provide references to tools that an investor might find useful when making investment decisions.
Once again, different strokes for different folks. We get to choose our own poison. You consistently misrepresent and exaggerate my true position. I do speak in a poaitive voice to support my positions. What is unexpected about that? Regardless, my......
Best Wishes

@MikeM - Hi there Mike- I think that msf has pretty well covered the general response to your questions. Because Monte Carlo simulation was not widely available during our working years, I designed (took me a while, I'll tell you) a "predictive" spreadsheet which I integrated into the general financial spreadsheet which I had used for some years (and still use) to keep track of our various investments.
The "predictive" section took account of all resources which would be available to my wife and I after retirement: pensions, SS, Medicare, and income or value increase in investments of equity vehicles, bond vehicles, and real estate. Likewise we had excellent data which had been accumulated over a number of years with respect to anticipated expenses, broadly classified as "basic" (unavoidable), discretionary, and emergency.
Each of those variables was referenced to large tables which were set up to independently run compounded values over 35 years. Independent inputs for variables included inflation rate, rate of return on equities, bonds and cash (CDs and savings) accounts, and a "financial disaster" input which introduced a general meltdown variable selectable for any given year in the 35 year stretch.
By varying each of those inputs in any desired combination it was possible to see the cascading effect of various disaster scenarios occurring at different selected times. For example, I generally ran cash and bond income at 2% below the inflation rate, which was also a selected variable, and equity income at 2% above. Very conservative. Being a pessimist by nature, I generally ran setups which would cover every bad thing happening that I could imagine.
As it happened, I wasn't too far off in the predictive timing for disaster. Destruction of financial resources will be most influential the earlier that they happen in retirement, as they can set back the entire cumulative compounding effects quite seriously. Indeed, Murphy struck, in 2007/2008, just after retirement.
Nevertheless, the tables worked out pretty well. By pulling down our discretionary expenses (another independent variable input) we survived the chaos in good shape, and were able to carry on with no huge impact to our retirement mode.
Edit/add: I should also mention that we were deliberately in good shape with respect to loans and finance charges: 30 year mortgage @8% had been paid off ten years early, never any credit card or other interest expenses. (Once the mail was late with a credit card payment and it cost something like $4.21. My wife still mentions that occasionally.)
MGJ dismissed this whole effort rather casually with a reference to the "limitations" of a spreadsheet for these purposes, and endless exaltations and paeans as to the superiority and invincibility of Monte Carlo. He's welcome to his opinion: just take it with a large grain of whatever. He seems to be one of those folks who believe that whatever they do is the right and only way, that anything else is highly suspect or at best barely acceptable, and thoroughly enjoy telling you so. I'm sure that you know the type.
Regards
OJ

Hi msf,
Who was first in discovering the 4% drawdown rule is not significant to me. My number one purpose in my submittals on this topic was to introduce Monte Carlo simulators to those MFOers who might not be familiar with this powerful decision enhancing tool.
Even the last reference you quoted acknowledged its usefulness. In the opening statements they said: "Monte Carlo simulations will illuminate the nature of that uncertainty, but only if advisors understand how it should be applied – and its limitations". All tools have identical limitations and misusing a tool is certainly dangerous stuff. Nothing new to these constraints.
I am an experienced user of Monte Carlo analyses. In the nuclear engineering discipline (one of my masters degrees is in that field), it is a frequently used tool.
When making my retirement decision I generated my own Monte Carlo code to aid in the decision process. I recognized the shortcoming of using a Normal distribution for returns (it's not too bad but it is imperfect) so I coupled that distribution with my model for much less frequently occurring fat tails. I am not an unsophisticated user of this fine modeling concept.
There are many strategies when investing. We are different investors because of numerous critical factors including our needs, our timeframes, our knowledge, and our risk aversion. Different strokes for different folks certainly applies here.
A Monte Carlo code is one way to approach the uncertainties of market returns. From my perspective it seems like an ideal tool. You take issue which is ok by my standards. That's what makes for a vibrant marketplace.
I especially like Monte Carlo simulations because what-if scenarios can be postulated and evaluated in just short minutes. That's powerful stuff given the uncertainties of market returns. Nobody can forecast future returns with any accuracy and/or consistency. Monte Carlo helps to quantify the impact of such uncertainty on portfolio,survival odds.
Apparently you are not a fan of the Monte Carlo based approach. I am. Again, different strokes for different folks. In investing we get to choose our own poison.
Best Wishes

I'm hearing all that is wrong with Monte Carlo simulation. So, @msf, @Old_Joe, tell me a better, easy to use tool for getting an idea where you stand with retirement spending potential. Show me something else that will "estimate" the probability of your retirement money lasting as long as you do. Show me another tool that shows this type of guidance.
There are no guaranties these simulations will play-out. Nobody thinks they are infallible. But they sure as heck are better than hope and a prayer. I side with MJG on there usefulness for guidance.

Defined benefits are part of your compensation in addition to the base salary, insurance coverage, vacation, sick leave, and retirement funding.
Defined pension plan, although rapidly disappearing, is your retirement pension once you are "vested", typically 3-5 years of employment. Defined contribution plan, or 401(K) in private sector, or 403(b) in education sector. 401(k) plan is funded by the employees on pretax dollars and therefore reduces the taxable income (say your base salary). If you contribute to the maximum dollar amount in 2018, this amounts to $18,000. If you are over the age of 50, you can contribute additional $6,000. Your employers can contribute up to 5-6% of your base salary to your 401(k). If you are in 25% tax bracket, your tax saving is $4,500 (0.25 X $18,000),
As bee pointed out, the HSA and FSA are also available. Since the medical insurance enrollment is upon us now, it is important to talk with your HR as soon as possible.

All types of Monte Carlo simulators are currently available on the Internet. I never explored life expectancy ones before your question, but they too exist. Here is one from Vanguard:
https://personal.vanguard.com/us/insights/retirement/plan-for-a-long-retirement-tool
I have no idea how good or reliable it is, but it is probably a respectable starting point. Good luck and a long life expectancy.

Better yet, have a long life and beat the odds!
The Vanguard page doesn't do simulations. It basically just does table lookups: "Calculations are based on mortality data from the Society of Actuaries Retirement Participant 2000 Table."
https://www.soa.org/experience-studies/2000-2004/research-rp-2000-mortality-tables/
It calculates the probability of at least one surviving as:
100% - (probability of person A dying) x (probability of person B dying)
This calculation has the same flaw that many investment Monte Carlo simulations have. They assume that events are independent: there are no economic cycles; the death of one spouse has no effect on the life expectancy of the survivor.
The Science of Longtime Couples Who Die Close Together
https://www.thecut.com/2015/11/science-of-longtime-couples-who-die-together.html

Hi Slick,
Thanks for giving Monte Carlo a try. Given that you demonstrated an interest to explore this tool, I suggest you might like to examine yet another Monte Carlo code that offers more input flexibility. Here is a Link to one such code:
https://www.portfoliovisualizer.com/monte-carlo-simulation#analysisResults
This version is from Portfolio Visualizer. Give it several runs. Don't expect the results to be exactly duplicated each time. That's the nature of Monte Carlo. It's an uncertain world. The range of outcomes hopefully will add to your confidence when making the big impact retirement decision.
Best Wishes
Hi Old Joe,
All types of Monte Carlo simulators are currently available on the Internet. I never explored life expectancy ones before your question, but they too exist. Here is one from Vanguard:
https://personal.vanguard.com/us/insights/retirement/plan-for-a-long-retirement-tool
I have no idea how good or reliable it is, but it is probably a respectable starting point. Good luck and a long life expectancy.
Best Wishes

"The 4% retirement rule ... is based on multiple studies that included using Monte Carlo analyses"
What the WSJ article says: "Based on pioneering research in the early 1990s by William Bengen, then a financial planner in California, the so-called 4% rule states that retirees can pull about 4% annually from their nest egg (a figure Mr. Bengen eventually set at 4.5%), with a high probability that their savings will last 30 years."
Bengen's research had nothing to do with Monte Carlo analyses, such as "This Vanguard Monte Carlo calculator."
Bengen said so himself: "Let me add that I am a great admirer of Vanguard and their effort to serve investors well with low-cost, well-managed funds. I use their funds in my personal portfolio. But our approach to computing "safe" withdrawal rates ... is quite different."
https://www.aaii.com/journal/article/insights-on-using-the-withdrawal-rule-from-its-creator
That excellent 2018 interview with Bengen was linked to by the WSJ article. To me what is interesting is not so much the 4% figure as why he picked a thirty year target. (FWIW, in 1994, the IRS joint life table for a couple of 65 year olds was 25 years. The current Table III shows 27.4 years for a 70 year old couple, so we can assume that a 65 year old couple would have at least a 30 year life expectancy per IRS today).
Also, in his followup that I quoted from above, he addressed @slick's 3.5%

In contrast, my methods use actual historical returns and inflation rates in the order in which they occurred. Vanguard's methods create sequences of returns and inflation which probably never happened in reality. As a result, they may generate "worst case" scenarios worse than anything that has ever happened, while my methods search for the worst case that has actually occurred.
Note also that Vanguard uses different asset classes than I do in my research.

When you change things like that, numbers can change radically.

Hi Guys,
The 4% retirement rule is more than just a random percentage selected as a starting point when making that critical retirement date. It is based on multiple studies that included using Monte Carlo analyses that explored thousands of income scenarios. I know because I did not initially trust that key percentage so I did my own Monte Carlo analyses when making my own retirement decision. Those independent calculations generated very high portfolio and income survival likelihoods for the 4% drawdown strategy.
Of course, any calculation output, regardless of its complexity, is directly dependent upon the input values. I explored a range of many reasonable performance likelihoods. As expected, survival probabilities changed. But all my analyses projected comfortable income survival rates when withdrawals were centered on the 4% annual rate. At even a 5% drawdown rate, portfolio survival rates are still high, but the degradation in survival probabilities were impacted to a level that compromised my comfort level.
There are no perfect one size fits all correct drawdown rule, but the 4% target goal is not a bad point of departure. For everyone, a final number is dependent on special circumstances that include a retiree's discipline to stay with a plan, yet be flexible enough to make moderate adjustments if circumstances change. Circumstances will most likely change so a retiree must always remain alert.
Good luck to anyone making the retirement decision soon,
Best Wshes

FYI: Some experts argue for withdrawal strategies tied to changing conditions.
Regards,
Ted
https://www.wsj.com/articles/the-4-retirement-rule-is-just-a-starting-point-1536245877?mod=article_inline

Is your goal only to withdraw yield in retirement? I believe concentrating or limiting investments to yield bearing investments is a huge mistake. Total return is what matters.

@Ted:
As I mentioned in another thread, thanks to you I'm ahead $61 so far.

Is that 61 Bil or 61 Mil? I suppose it becomes hard to count after a while. :)
Knew a guy once who invested a great deal of his and his wife's retirement monies in some big distillers - mainly so she couldn't complain when he "sampled" their products - which was often.

Leaving out Tillinghast and Danoff is a nonstarter for me. Then again maybe it's a clue that these two might be getting set to hit the retirement highway.

FYI: Most target-date funds are either actively managed or passively track indexes. Fidelity Investments is betting that investors will want both in one wrapper.
The firm launched a suite of 13 Fidelity Freedom Blend Funds on Tuesday. Each fund holds an underlying mix of actively managed and index funds run by Fidelity. The target dates range from 2005—featuring the most conservative mix of socks and bonds—to 2060, with the highest equity exposure. The funds hold an average of 40% in underlying index funds, with expense ratios ranging from 0.26% to 0.54%, depending on the share class.
Regards,
Ted
https://www.barrons.com/articles/fidelitys-latest-gambit-for-your-retirement-savings-1536247498
Fidelity Website: Fidelity Freedom Blend Funds:
https://www.fidelity.com/about-fidelity/institutional-investment-management/fidelity-investments-launches-target-date-blend-funds

By the author not stating what the fees and commissions are for the respective type of account noted within the article ... How is one to know if one is better than the other? As a reader I'm still left in flux. When I looked into this the accounts with wrap fees also had fees for the fees the mutual funds charged. This put fees on top of fees.
I found none that beat what I had with my traditional retirement account thus I let it become grandfathered rather than rolling it into a fees only based account.
I remain in flux and plan to continue with what I have as Morningstar estimates my annual expense ratio at 0.76 percent. And, that is all I pay. I was unable to find an account with a wrap fee back of one percent.
Still in flux ...

FYI: (This is a follow-up article.)
The fiduciary rule is dead, but its spirit lives on.
The rule, which the Department of Labor first proposed in 2015, required brokers to act as fiduciaries — to put their clients’ interests ahead of their own — when handling retirement accounts. It sounded simple, but it meant that brokers would have to rethink the way they do business.
Regards,
Ted
https://www.bloomberg.com/view/articles/2018-09-04/merrill-lynch-can-t-restore-the-bad-old-days-of-conflicts

FYI: Retirement investment products are failing too many investors, according to a group of researchers, but there may be a better way.
Regards,
Ted
https://www.fa-mag.com/news/a-new-retirement-bond-40414.html?print

@LewisBraham. Very solid post in my opinion. I am effectively retired as of 9/1/18. With above average S.S. , a paid for home and a substantial portfolio.. luckier than most. And who knows what the future might hold? I can't imagine how the masses would fare,,, given what I read about their retirement readiness. It's only gonna get worse for many.

@Davidrmoran
Good grief, acknowledge that you ARE atypical first and stop with the obnoxious good griefs. (You're not talking to Charlie Brown.) Look at the damn stats about savings for most Americans and tell me how you are typical when half have nothing saved for retirement! Our definitions of atypical are not dissimilar and you know it. I suspect from your post history you rank fairly high on the spectrum of amount saved for your age group--nothing at all typical about that. Are you next going to lecture about Americans drinking too many lattes and eating too much avocado toast and that's why they have no savings? Because I also suspect you know that is largely bs. So extrapolating your personal success with the retirement system as some sort of evidence of its larger success for the general or "typical" population is absurd.
What's the government to do? Nothing this government would ever do, but it would be to dramatically increase Social Security payments and/or create a Basic Guaranteed Income, and yes, raise income taxes/estate taxes/corporate taxes and capital gains taxes to pay for it. And it would be to finally acknowledge that some problems in post-industrial highly developed economies can't be solved via GDP growth and that that outmoded way of thinking has disastrous environmental consequences. So yes free markets, but tax appropriately to save people from their worst instincts--buying lattes, avocado toast and big screen TVs if you read the usual asinine arguments--but in reality their general poverty resulting from that massive drain of wealth caused by technology and globalization.
But assuming that the government will never do this, which is the correct assumption, the simplest path would be to leave the current system alone and not make the regressive retirement system we currently have even worse than it already is by getting rid of RMDs at age 70 1/2.
And what is the point of the original provisions?--ostensibly as MFS already spelled out quite clearly to get ordinary Americans to save. What was the other unspoken point? To create a new savings system that allowed companies to eliminate their pension plans and put the burden of retirement on employees' shoulders. And it was to foster the growth of the industry to which this board is dedicated. The ostensible goal of getting Americans to save has proven a complete failure for half of America--because apparently they like cheese and cigarettes--and largely a failure for millions of other Americans who still haven't saved enough. And yes, I know the previous pension plan system had many flaws too--another reason to take that pension system out of corporate hands and extend, expand, increase Social Security, which is the exact opposite of what our current government plans. Anything else or must I expect another sarcastic good grief directed my way?

@DavidRMoran How successful does this sound to you?:

Around half of American households have no retirement accounts at all. No 401(k)s, no IRAs, nothing. You might think that’s because they’re all expecting pension income in retirement. In fact, according to the Government Accountability Office (GAO), around 29% of households age 55 and older have neither retirement savings nor a pension. It doesn’t paint a pretty picture.

Not news, and not what I was saying about those who partook.
So good grief (favored locution with you), man, whose doing, or whose fault do you think this is? Not to sound like a wingnut anti-libtard, since you can take offense all you want but you fully know by now where I stand, is this the doing of gov, and / or / but what do you think gov role in all of this should be?
It is like the args made about lack of exercise and smoking and fat and health. I have a bil who works for Doctors Without Borders but used to be a cardio in Michigan with a preponderance of patients who were cheese-eating smokers, as his practice put it.
As he himself still says, talk about a collision of values / goals / efforts / freedom policies.
So ... what IS your point about the original provisions? How is success to be defined? You are the one who (wrongly, maybe) defined original intention. Read msf's links. I bet we are in violent agreement about future policy, or close.
But we are talking about the past, and I was commenting on all those who partook of this new legislation bigtime, including myself.