Q. I’ve been doing some estimates for retirement with the TSP calculator. I plan on leaving my money in G Fund after retirement, and for interest, I’ve been putting 3 percent. Is that a conservative enough amount?
A. The calculator is unrealistic in that:
1. It assumes that a constant rate of investment return will be earned each and every year, like clockwork;
2. You can predict what this rate will be;
3. You know how long you’re going to live;
4. Inflation isn’t a factor.
Each of these assumptions is absurd. I think that the calculator is, at best, of little use, and, at worst, dangerous. You’ll find an article I wrote on the subject here: http://www.variplan.com/uploadedDocuments/1282316219Use_TSP_calculators_at_your_own_risk.pdf.