Mind Over Market

The providers of retirement calculators vie to improve the forecasting accuracy of their models Robert Stowe England January 5, 2017 See companion article at  this link .  In recent years intensifying competition among providers of retirement calculators has sparked a race to build better models. The goal is to design a calculator that can forecast results that can more closely mimic actual results from real people saving for retirement. The models, in essence, aim to raise the degree of fidelity of the model to real life. Fidelity, in this case, “is defined as the ability of a calculator to potentially produce reality,” according to retired software developer Darrow Kirkpatrick, who has published a list of The Best Retirement Calculators . The constant testing of existing and new calculators for their strengths and weaknesses has been at the heart of the race to attain high fidelity. Those working to build more sophisticated models, including some...

Those who have tested several calculators find different models tend to come up with different answers By Robert Stowe England January 5, 2017 See companion article at  this link . How much money will you need to retire and live comfortably? That’s the question online retirement calculators try to answer. The answer to that question, in turn, affects how much you need to save every year and how you should invest your assets to reach your retirement goals. Those who have tested several calculators find different models tend to come up with different answers to the same question. Some observers attribute the different outcomes to different model designs and varying assumptions about inflation and investment return, among other factors Online retirement tools require users to submit data on annual income, annual savings, accumulated assets, and the number of years until retirement. The tools generate an estimated total savings you will need when you retire. Some al...

American households have embarked on a process of debt reduction that could take years to complete, based on historical comparisons, according to a study by the San Francisco Fed. This deleveraging will be painful whether it is from belt-tightening to increase savings and reduce debt -- or through foreclosures, short-sales of homes or bankruptcies. This seems to suggest that the economic recovery that is on the horizon will be weak and that gains in economic growth could be terribly slow in coming. By Robert Stowe England May 30, 2009 Americans have been living beyond their means for so long that they can no longer do so. They have, in fact, begun a long and likely painful process of deleveraging or debt reduction that could last for many years. Economists measure household frugality or profligacy by calculating the ratio of debt to personal disposable income. In 2007 that ratio for the average American household reached an all-time high of 133 percent. By contrast, in 1960 the ratio s...