new algorithm
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@ -40,7 +40,12 @@ const formSchema = z.object({
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desiredMonthlyAllowance: z.coerce
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.number()
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.min(0, "Monthly allowance must be a non-negative number"),
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swr: z.coerce.number().min(0.1, "Withdrawal rate must be at least 0.1%"),
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inflationRate: z.coerce
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.number()
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.min(0, "Inflation rate must be a non-negative number"),
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lifeExpectancy: z.coerce
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.number()
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.min(50, "Life expectancy must be at least 50"),
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});
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// Type for form values
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@ -49,6 +54,8 @@ type FormValues = z.infer<typeof formSchema>;
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interface CalculationResult {
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fireNumber: number | null;
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retirementAge: number | null;
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inflationAdjustedAllowance: number | null;
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retirementYears: number | null;
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error?: string;
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}
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@ -59,68 +66,170 @@ export default function FireCalculatorForm() {
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const form = useForm<FormValues>({
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resolver: zodResolver(formSchema),
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defaultValues: {
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startingCapital: 10000,
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monthlySavings: 500,
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currentAge: 30,
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startingCapital: 50000,
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monthlySavings: 1500,
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currentAge: 25,
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cagr: 7,
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desiredMonthlyAllowance: 2000,
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swr: 4,
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inflationRate: 2,
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lifeExpectancy: 90,
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},
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});
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function onSubmit(values: FormValues) {
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setResult(null); // Reset previous results
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const sc = values.startingCapital;
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const ms = values.monthlySavings;
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const ca = values.currentAge;
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const annualRate = values.cagr / 100;
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const monthlyAllowance = values.desiredMonthlyAllowance;
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const safeWithdrawalRate = values.swr / 100;
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const startingCapital = values.startingCapital;
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const monthlySavings = values.monthlySavings;
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const currentAge = values.currentAge;
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const annualGrowthRate = values.cagr / 100;
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const initialMonthlyAllowance = values.desiredMonthlyAllowance;
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const annualInflation = values.inflationRate / 100;
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const lifeExpectancy = values.lifeExpectancy;
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// Calculate FIRE number (the amount needed for retirement)
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const fireNumber = (monthlyAllowance * 12) / safeWithdrawalRate;
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const monthlyGrowthRate = Math.pow(1 + annualGrowthRate, 1 / 12) - 1;
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const monthlyInflationRate = Math.pow(1 + annualInflation, 1 / 12) - 1;
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const maxIterations = 1000; // Safety limit for iterations
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let currentCapital = sc;
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let age = ca;
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const monthlyRate = Math.pow(1 + annualRate, 1 / 12) - 1;
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const maxYears = 100; // Set a limit to prevent infinite loops
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// Binary search for the required retirement capital
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let low = initialMonthlyAllowance * 12; // Minimum: one year of expenses
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let high = initialMonthlyAllowance * 12 * 100; // Maximum: hundred years of expenses
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let requiredCapital = 0;
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let retirementAge = 0;
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let finalInflationAdjustedAllowance = 0;
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if (currentCapital >= fireNumber) {
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setResult({ fireNumber, retirementAge: age });
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return;
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}
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// First, find when retirement is possible with accumulation phase
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let canRetire = false;
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let currentCapital = startingCapital;
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let age = currentAge;
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let monthlyAllowance = initialMonthlyAllowance;
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let iterations = 0;
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for (let year = 0; year < maxYears; year++) {
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const capitalAtYearStart = currentCapital;
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// Accumulation phase simulation
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while (age < lifeExpectancy && iterations < maxIterations) {
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// Simulate one year of saving and growth
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for (let month = 0; month < 12; month++) {
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currentCapital += ms;
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currentCapital *= 1 + monthlyRate;
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currentCapital += monthlySavings;
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currentCapital *= 1 + monthlyGrowthRate;
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// Update allowance for inflation
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monthlyAllowance *= 1 + monthlyInflationRate;
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}
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age++;
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iterations++;
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if (currentCapital >= fireNumber) {
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setResult({ fireNumber, retirementAge: age });
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return;
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// Check each possible retirement capital target through binary search
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const mid = (low + high) / 2;
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if (high - low < 1) {
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// Binary search converged
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requiredCapital = mid;
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break;
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}
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// Prevent infinite loop if savings don't outpace growth required
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if (currentCapital <= capitalAtYearStart && ms <= 0) {
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setResult({
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fireNumber: null,
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retirementAge: null,
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error: "Cannot reach FIRE goal with current savings and growth rate.",
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});
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return;
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// Test if this retirement capital is sufficient
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let testCapital = mid;
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let testAge = age;
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let testAllowance = monthlyAllowance;
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let isSufficient = true;
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// Simulate retirement phase with this capital
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while (testAge < lifeExpectancy) {
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for (let month = 0; month < 12; month++) {
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// Withdraw inflation-adjusted allowance
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testCapital -= testAllowance;
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// Grow remaining capital
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testCapital *= 1 + monthlyGrowthRate;
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// Adjust allowance for inflation
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testAllowance *= 1 + monthlyInflationRate;
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}
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testAge++;
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// Check if we've depleted capital before life expectancy
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if (testCapital <= 0) {
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isSufficient = false;
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break;
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}
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}
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// If loop finishes without reaching FIRE number
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if (isSufficient) {
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high = mid; // This capital or less might be enough
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if (currentCapital >= mid) {
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// We can retire now with this capital
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canRetire = true;
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retirementAge = age;
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requiredCapital = mid;
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finalInflationAdjustedAllowance = monthlyAllowance;
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break;
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}
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} else {
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low = mid; // We need more capital
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}
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}
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// If we didn't find retirement possible in the loop
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if (!canRetire && iterations < maxIterations) {
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// Continue accumulation phase until we reach sufficient capital
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while (age < lifeExpectancy && iterations < maxIterations) {
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// Simulate one year
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for (let month = 0; month < 12; month++) {
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currentCapital += monthlySavings;
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currentCapital *= 1 + monthlyGrowthRate;
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monthlyAllowance *= 1 + monthlyInflationRate;
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}
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age++;
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iterations++;
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// Test with current capital
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let testCapital = currentCapital;
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let testAge = age;
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let testAllowance = monthlyAllowance;
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let isSufficient = true;
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// Simulate retirement with current capital
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while (testAge < lifeExpectancy) {
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for (let month = 0; month < 12; month++) {
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testCapital -= testAllowance;
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testCapital *= 1 + monthlyGrowthRate;
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testAllowance *= 1 + monthlyInflationRate;
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}
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testAge++;
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if (testCapital <= 0) {
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isSufficient = false;
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break;
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}
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}
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if (isSufficient) {
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canRetire = true;
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retirementAge = age;
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requiredCapital = currentCapital;
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finalInflationAdjustedAllowance = monthlyAllowance;
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break;
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}
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}
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}
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if (canRetire) {
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setResult({
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fireNumber: requiredCapital,
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retirementAge: retirementAge,
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inflationAdjustedAllowance: finalInflationAdjustedAllowance,
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retirementYears: lifeExpectancy - retirementAge,
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error: undefined,
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});
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} else {
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setResult({
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fireNumber: null,
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retirementAge: null,
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error: `Could not reach FIRE goal within ${maxYears.toString()} years.`,
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inflationAdjustedAllowance: null,
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retirementYears: null,
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error:
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iterations >= maxIterations
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? "Calculation exceeded maximum iterations."
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: "Cannot reach FIRE goal before life expectancy with current parameters.",
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});
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}
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}
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// Helper function to format currency
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const formatCurrency = (value: number | null) => {
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@ -218,7 +327,7 @@ export default function FireCalculatorForm() {
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render={({ field }) => (
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<FormItem>
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<FormLabel>
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Desired Monthly Allowance in Retirement
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Desired Monthly Allowance (Today's Value)
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</FormLabel>
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<FormControl>
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<Input
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@ -233,13 +342,13 @@ export default function FireCalculatorForm() {
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/>
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<FormField
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control={form.control}
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name="swr"
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name="inflationRate"
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render={({ field }) => (
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<FormItem>
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<FormLabel>Safe Withdrawal Rate (%)</FormLabel>
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<FormLabel>Annual Inflation Rate (%)</FormLabel>
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<FormControl>
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<Input
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placeholder="e.g., 4"
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placeholder="e.g., 2"
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type="number"
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step="0.1"
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{...field}
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@ -249,6 +358,23 @@ export default function FireCalculatorForm() {
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</FormItem>
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)}
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/>
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<FormField
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control={form.control}
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name="lifeExpectancy"
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render={({ field }) => (
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<FormItem>
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<FormLabel>Life Expectancy (Age)</FormLabel>
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<FormControl>
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<Input
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placeholder="e.g., 90"
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type="number"
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{...field}
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/>
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</FormControl>
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<FormMessage />
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</FormItem>
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)}
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/>
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</div>
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<Button type="submit" className="w-full">
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@ -281,6 +407,24 @@ export default function FireCalculatorForm() {
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{result.retirementAge ?? "N/A"}
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</p>
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</div>
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{result.inflationAdjustedAllowance && (
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<div>
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<Label>
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Monthly Allowance at Retirement (Inflation Adjusted)
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</Label>
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<p className="text-2xl font-bold">
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{formatCurrency(result.inflationAdjustedAllowance)}
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</p>
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</div>
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)}
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{result.retirementYears && (
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<div>
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<Label>Retirement Duration (Years)</Label>
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<p className="text-2xl font-bold">
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{result.retirementYears}
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</p>
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</div>
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)}
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</div>
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)}
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</CardContent>
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