> There is no need for 'withdrawal rate' parameter, because it really depends on how long you expect to live after you retire.
That calculator intentionally assumes "forever", which gives you a safe margin for error; that doesn't actually change the amount you need to save by very much. Also, as the URL suggests, that calculator aims particularly at people trying to save heavily and retire early, and given that, the difference between "save enough for 50-60 years of retirement" and "save enough for an indefinite retirement" doesn't add up to very much.
> Also, with the defaults it has (5% above-inflation profit and 4% withdrawal rate), it results in the savings that never end but continue growing at about 1% per year
Again, margin for error. If you count on withdrawing exactly what you can get from your investments, then whenever those investments don't do so well in a particular year, you'd get significantly less income than you planned on.
OK. I did my own estimates in an Excel spreadsheet with some VBA in it, using S&P 500 data (growth, dividends) in a monte carlo-like pattern. That got me to about 15% savings rate guaranteeing 95%+ chance that my money will outlive me. Something i am quite happy with.
And yes, i didn't use 'inflation' at all. Prosperity and 'good living standards' is relative. If an old guy started saving in 1960 when he was 25 and he's now 77, what was good living standard then is now poverty. I used nominal GDP per capita to 'deflate' my net worth over years, data from www.measuringworth.com.
Another reason why i don't recommend using 'inflation' is that everyone has different consumer bundle so his inflation is different from the CPI. And the measurement of inflation is overally broken, i don't trust it, and believe it is meaningless. As long as you don't face risk of starvation, there is little importance on how much stuff you can buy, how you do vs others is important.
That calculator intentionally assumes "forever", which gives you a safe margin for error; that doesn't actually change the amount you need to save by very much. Also, as the URL suggests, that calculator aims particularly at people trying to save heavily and retire early, and given that, the difference between "save enough for 50-60 years of retirement" and "save enough for an indefinite retirement" doesn't add up to very much.
> Also, with the defaults it has (5% above-inflation profit and 4% withdrawal rate), it results in the savings that never end but continue growing at about 1% per year
Again, margin for error. If you count on withdrawing exactly what you can get from your investments, then whenever those investments don't do so well in a particular year, you'd get significantly less income than you planned on.