i have trouble coming up with real estimates on future expenses

Agreed this is one of the hardest parts. This is where it can be beneficial to work with someone who is building many peoples simulations so they can provide estimates. But yeah it tends to lean to being too conservative usually

I generally look at the past 2-3 years and try to estimate from there. Some things like medical, tuition and food expenses I increase every year as kids get older, others are well known (like insurance)

There are other ones that take a lot more work to estimate like long term care, in home vs facility, etc.

@rich-insurance-32675 will you be paying tuition after retirement and covering food/medical for as many people?

I definitely would recommend not looking at current expenses as an estimate since before kids and after kids are different worlds. Instead the process I go through with families is to help them design the future they would like to have and then price that out. Visiting grandchildren or grandchildren visiting them for example which is a massive expense.

“All models are wrong; some are useful.” - George Box I feel like being very specific is probably not going to improve the helpfulness of the model. There are just too many factors out of your control that can make huge positive or negative impact on expenses and on the value of your portfolio when you are cashing out. I would just like a ball park figure to shoot for to achieve high/medium/low standard of living for x years.

Knowing whether or not you want to have 50k a year for 10 years for in home long term care are massive values to consider. We obviously only want to put large items into the model.

@straight-nightfall-20143 I thought the question was about short term planning (1-3 years). Didn’t realize the discussion was about retirement.

I feel like Monte Carlo doesn't provide much value for 1 to 3 year planning. Or maybe I'm missing something from the discussion

It was my misunderstanding

Oh okay now I'm tracking. My bad 👍

cross-posting this from the previous thread:

I have no real way of estimating my expected spending rate after retirement. Maybe 3 of my kids will want to be supported in Kollel (and I'd love to do that for them for a bit) and maybe they will have 13 kids and live down the block and come for large Shabbos seudos, and maybe we will make aliyah when we retire, and maybe my special needs son will need full time care, and maybe...