Hi, For legal reasons I'm not sure I can do that. I don't know what is in the fine print of their agreement. But here's the thing. Boldin can never get anything right for the simple reason that spending it treated as fixed. It's apparently set at 4% of your retirement assets forever -- how nuts is that? Or you're asked to input your expenses. If you are 65, that's 35 years of expenses -- all being guessed and, in total, either unaffordable or under affordable. You can only spend what you have and what you spend determines what your taxes are and, therefore, what you have, which determines what you can spend and on and on. The fundamental chicken and egg problem, which is compounded by cash-flow constraints, is avoided by Boltin by either using a rule of dumb to set spending or having the user input something at which they are guessing. Once that spending path is set, it's in concrete. Change anything, like your retirement age, and spending doesn't move. The only thing that changes is what you leave your heirs. That's great for the super rich and investment advisors, but not for normal people who need to spend what they have and make sure they don't run out. You do get this, right? If not, pls call me at 617 834-2148 and we'll discuss. Also, pls run MaxiFi and let me know what it tells you compared to Boldin. My email is kotlikoff@gmail.com. Hope I'm not being too abrupt in my response. I'm just applying tough love. Love, Larry
Hi Joe, I don't disagree. But you need calculations that are correct for each potential scenario. If, for example, you use the 1945 federal tax schedule to consider Roth conversions, everything you did would be precisely wrong. MaxiFi is doing both deterministic (what if) scenario analysis as well as stochastic (lifetime expected utility) maximization. The deterministic results need to be 100 percent right -- not based on guess work. Then you consider another deterministic scenario.
Hi David, This statement doesn't mean the world is certain. It means that for any potential future path of outcomes, the calculations for that path are correct. That's what expected lifetime utility maximization is about. Perhaps we should discuss on the phone. best, Larry 617 834-2148 Call me any time. best, Larry
Hi Russ, No obsession, just conveying what our new integrated conversion feature shows for many households, namely go big and quick. But you can run MaxiFi with future deductible healthcare expenses and that will, indeed, reduce the gain for conversions and the conversion amounts that MaxiFi suggests. Give it a go and see what you think. yours, Larry
Wow really surprised Prof Kotlikoff, total hit job using the free version of Boldin to compare to MaxiFi. Spend the $120 for the annual subscription for Boldin and rerun your analysis. Some academic you purport to be more like a disgruntled owner of MaxiFi losing subscriptions to Boldin I think. Do better. Used to be a MaxiFi user so I think I know of what I speak and your article is terrible.
You missed a lot of things in Boldin. Maybe take out a subscription and really work the numbers in the paid version of Boldin and educate yourself so you can compare apples to apples and give a proper comparison!
With respect, the statement “Financial planning, like brain surgery, is precision business. You either get things precisely right or terribly wrong” is misguided. Neither financial planners, self-directed investors, banks, investment firms, the Treasury Department, the Federal Reserve, nor any system that relies on variable inputs can precisely predict outcomes. Even if AI one day becomes extraordinarily advanced, it will never be able to perfectly foresee the future.
Every moment, variables prove their variability—choices are made, and unexpected events occur, often with significant impacts. No matter how well-constructed a financial planning product may be, it can only project likely outcomes based on current conditions.
What people truly need is common sense, regular review, and consistent planning that accounts for risks and includes potential mitigating actions. The article reads as an unfair critique of a competitor and leaves a negative impression.
I missed your sale. I broke my leg, ankle, and pulled a tendon so I was out of commission for a bit. The Roth calculator sounds very interesting so it's time to sign up again.
Interesting point. They missed the RMD and part B premium benefits of the conversion….You are suggesting an age range for retirees, and that can be modeled, too. What was the living standard change for the 94/95 year old couple if they do convert?
There seems to be this obsession to convert almost all Traditional IRA to Roth IRA. But here's where that strategy fails miserably. (True story). Husband and Wife both in their 90's and both in poor health and needing assistance with every phase of life - one with alzeheimer's. Wanting to avoid going into a nursing home and being separated, they decided to have 24/7 in-home care. This care is costing $20K/mo or $240K/year - practically all medically justifiable. If they withdraw the money from a traditional IRA, using the medical deduction in itemized deductions, they will incur very little taxes. If they had converted that traditional IRA to a Roth earlier, they would have had less money to draw from (because taxes would have been taken out) and that Roth would not last as long as the traditional IRA. The big question is what's the likelihood of long term nursing home care (> 2 years)? The liklihood/percentage is a direct function of age. For those above 85, estimates range from 13% to 40% requiring long term services and support (LTSS). Since the standard advice is to financially plan for surviving until you are in your mid-nineties, I would think that financial planning should also consider the likelihood that LTSS is in your future.
Hi, For legal reasons I'm not sure I can do that. I don't know what is in the fine print of their agreement. But here's the thing. Boldin can never get anything right for the simple reason that spending it treated as fixed. It's apparently set at 4% of your retirement assets forever -- how nuts is that? Or you're asked to input your expenses. If you are 65, that's 35 years of expenses -- all being guessed and, in total, either unaffordable or under affordable. You can only spend what you have and what you spend determines what your taxes are and, therefore, what you have, which determines what you can spend and on and on. The fundamental chicken and egg problem, which is compounded by cash-flow constraints, is avoided by Boltin by either using a rule of dumb to set spending or having the user input something at which they are guessing. Once that spending path is set, it's in concrete. Change anything, like your retirement age, and spending doesn't move. The only thing that changes is what you leave your heirs. That's great for the super rich and investment advisors, but not for normal people who need to spend what they have and make sure they don't run out. You do get this, right? If not, pls call me at 617 834-2148 and we'll discuss. Also, pls run MaxiFi and let me know what it tells you compared to Boldin. My email is kotlikoff@gmail.com. Hope I'm not being too abrupt in my response. I'm just applying tough love. Love, Larry
Hi Joe, I don't disagree. But you need calculations that are correct for each potential scenario. If, for example, you use the 1945 federal tax schedule to consider Roth conversions, everything you did would be precisely wrong. MaxiFi is doing both deterministic (what if) scenario analysis as well as stochastic (lifetime expected utility) maximization. The deterministic results need to be 100 percent right -- not based on guess work. Then you consider another deterministic scenario.
Hi David, This statement doesn't mean the world is certain. It means that for any potential future path of outcomes, the calculations for that path are correct. That's what expected lifetime utility maximization is about. Perhaps we should discuss on the phone. best, Larry 617 834-2148 Call me any time. best, Larry
M. Pls email me at kotlikoff@gmail.com. Sorry about your leg! Yikes. best, Larry
Hi Russ, No obsession, just conveying what our new integrated conversion feature shows for many households, namely go big and quick. But you can run MaxiFi with future deductible healthcare expenses and that will, indeed, reduce the gain for conversions and the conversion amounts that MaxiFi suggests. Give it a go and see what you think. yours, Larry
Wow really surprised Prof Kotlikoff, total hit job using the free version of Boldin to compare to MaxiFi. Spend the $120 for the annual subscription for Boldin and rerun your analysis. Some academic you purport to be more like a disgruntled owner of MaxiFi losing subscriptions to Boldin I think. Do better. Used to be a MaxiFi user so I think I know of what I speak and your article is terrible.
You missed a lot of things in Boldin. Maybe take out a subscription and really work the numbers in the paid version of Boldin and educate yourself so you can compare apples to apples and give a proper comparison!
With respect, the statement “Financial planning, like brain surgery, is precision business. You either get things precisely right or terribly wrong” is misguided. Neither financial planners, self-directed investors, banks, investment firms, the Treasury Department, the Federal Reserve, nor any system that relies on variable inputs can precisely predict outcomes. Even if AI one day becomes extraordinarily advanced, it will never be able to perfectly foresee the future.
Every moment, variables prove their variability—choices are made, and unexpected events occur, often with significant impacts. No matter how well-constructed a financial planning product may be, it can only project likely outcomes based on current conditions.
What people truly need is common sense, regular review, and consistent planning that accounts for risks and includes potential mitigating actions. The article reads as an unfair critique of a competitor and leaves a negative impression.
"Financial planning, like brain surgery, is precision business. You either get things precisely right or terribly wrong."
I stopped reading when I hit this statement. It's so wrong.
I missed your sale. I broke my leg, ankle, and pulled a tendon so I was out of commission for a bit. The Roth calculator sounds very interesting so it's time to sign up again.
Interesting point. They missed the RMD and part B premium benefits of the conversion….You are suggesting an age range for retirees, and that can be modeled, too. What was the living standard change for the 94/95 year old couple if they do convert?
There seems to be this obsession to convert almost all Traditional IRA to Roth IRA. But here's where that strategy fails miserably. (True story). Husband and Wife both in their 90's and both in poor health and needing assistance with every phase of life - one with alzeheimer's. Wanting to avoid going into a nursing home and being separated, they decided to have 24/7 in-home care. This care is costing $20K/mo or $240K/year - practically all medically justifiable. If they withdraw the money from a traditional IRA, using the medical deduction in itemized deductions, they will incur very little taxes. If they had converted that traditional IRA to a Roth earlier, they would have had less money to draw from (because taxes would have been taken out) and that Roth would not last as long as the traditional IRA. The big question is what's the likelihood of long term nursing home care (> 2 years)? The liklihood/percentage is a direct function of age. For those above 85, estimates range from 13% to 40% requiring long term services and support (LTSS). Since the standard advice is to financially plan for surviving until you are in your mid-nineties, I would think that financial planning should also consider the likelihood that LTSS is in your future.