Retirement Stress Test: See What Could Break Your Plan
This tool projects your savings to retirement, compares them against a modeled target, and then stress-tests the plan: it shows whether the plan clears your success threshold, which condition puts it under the most strain, how much safety margin it holds, and the smallest change that keeps it funded.
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Plan verdict
Projected real balance $913,841 vs modeled target $780,867 (modeled threshold). Modeled success 95% against a 85% threshold.
Reconciliation — projected vs target
Identity: projected − target = margin, on the modeled threshold basis. The residual is the identity check and should be under $0.01.
| Basis | Projected balance | Selected target | Margin | Residual |
|---|---|---|---|---|
| Nominal (future dollars) | $2,013,883 | $1,720,841 | +$293,042 | 0 |
| Real (today’s dollars) | $913,841 | $780,867 | +$132,974 | 0 |
Margin of safety or rescue plan
Your plan clears the 85% threshold. These are its decision boundaries — push any value just past its limit and the plan drops below threshold.
| Boundary | Limit |
|---|---|
| Maximum sustainable annual spending | $66,130 / yr (+$6,130 vs current) |
| Earliest retirement age | age 65 (-2 yrs vs current) |
| Minimum monthly contribution | $731 / mo (-$269 vs current) |
| Maximum annual fee | 0.7% (+0.4 pts vs current) |
| Maximum plan-through age | age 103 (+8 yrs vs current) |
| Maximum legacy target | $302,826 (+$302,826 vs current) |
Primary failure mode
The plan’s dominant vulnerability is expected accumulation return 3 percentage points lower, which cuts modeled success to 12.8% (-80 pts from a 92.8% baseline).
| Stress | Modeled success | Change vs baseline | Severity (pts) | Result |
|---|---|---|---|---|
| Expected accumulation return 3 percentage points lower | 12.8% | -80 pts | 80 | Fail |
| Inflation 1 percentage point higher | 65.2% | -27.6 pts | 27.6 | Fail |
| Expected accumulation return 1 percentage point lower | 75.2% | -17.6 pts | 17.6 | Fail |
| Retirement spending 10 percent higher | 85.2% | -7.6 pts | 7.6 | Pass |
| Plan horizon five years longer | 89.6% | -3.2 pts | 3.2 | Pass |
| Guaranteed income starts two years later | 92.8% | +0 pts | 0 | Pass |
Each stress applies one adverse change to the baseline, independently. Severity is the modeled-success drop; rows are ordered by the largest drop first. Each label describes exactly the change applied.
Historical crisis replay
Replaying the worst starting year the market dataset contains (1965) against your plan, in real dollars:
Derived from the same historical real-return sequence the backtest identifies as the worst starting year — not a hardcoded date.
Scenario comparison
| Scenario | Projected (today’s $) | Modeled target | Modeled success | Depletion age |
|---|---|---|---|---|
| Your current plan | $913,841 | $780,867 | 94.6% | beyond the plan horizon |
| Can I retire at 55? | $1,240,651 | $1,500,000 | 62.3% | age 86 |
| $1 million and the 4% rule | $1,000,000 | $1,000,000 | 92.8% | beyond the plan horizon |
| How long can $500,000 last? | $500,000 | $875,000 | 26.5% | age 81 |
Example scenarios load complete inputs and are illustrations, not recommendations.
Retirement savings projection
Historical sequence backtest
94.3% of 70 historical starting years funded this plan. Worst start year: 1965; best: 1982. Median real ending balance $1,316,132.
| Start year | Real ending balance | Outcome |
|---|---|---|
| 1965 | $0 | depleted at 93 |
| 1966 | $0 | depleted at 91 |
| 1968 | $0 | depleted at 93 |
| 1969 | $0 | depleted at 93 |
| 1964 | $84,464 | survived |
Longevity planning suggestion
At age 67, the life table shows about 18.1 more years of remaining life expectancy. With a 5-year planning buffer, a plan-through age near 90 is a reasonable reference (your current input is 95). This is informational only and does not change your plan-through age.
Source: U.S. Social Security Administration — Office of the Chief Actuary, as of 2025-12-31 — verification pending. A period life table is a population average, not a prediction for any individual.
Decision levers — what would improve the plan?
| Change | New modeled success | Improvement |
|---|---|---|
| Save $250 more per month | 96.4% | +1.8 pts |
| Spend 5% less in retirement | 96% | +1.4 pts |
| Reduce fees by 0.25 percentage points | 96% | +1.4 pts |
| Retire one year later | 95.6% | +1 pts |
Each row is the independent effect of one change; only changes that raise modeled success are listed. The largest number is not automatically the best choice for you.
When can I retire?
The first modeled retirement age meeting your 85% threshold is 65. Retiring at your planned age of 67 to that threshold would take about $0 more per month.
Year-by-year table
Show the full year-by-year projection (nominal and today’s dollars)
| Age | Phase | Opening (nominal) | Contribution | Growth | Guaranteed | Spending | Withdrawal | Ending (nominal) | Ending (today’s $) |
|---|---|---|---|---|---|---|---|---|---|
| 36 | Saving | $150,000 | $12,000 | $9,095 | $0 | $0 | $0 | $171,095 | $166,922 |
| 37 | Saving | $171,095 | $12,000 | $10,330 | $0 | $0 | $0 | $193,425 | $184,105 |
| 38 | Saving | $193,425 | $12,000 | $11,636 | $0 | $0 | $0 | $217,062 | $201,563 |
| 39 | Saving | $217,062 | $12,000 | $13,019 | $0 | $0 | $0 | $242,081 | $219,314 |
| 40 | Saving | $242,081 | $12,000 | $14,483 | $0 | $0 | $0 | $268,565 | $237,372 |
| 41 | Saving | $268,565 | $12,000 | $16,033 | $0 | $0 | $0 | $296,598 | $255,755 |
| 42 | Saving | $296,598 | $12,000 | $17,673 | $0 | $0 | $0 | $326,271 | $274,480 |
| 43 | Saving | $326,271 | $12,000 | $19,410 | $0 | $0 | $0 | $357,680 | $293,565 |
| 44 | Saving | $357,680 | $12,000 | $21,247 | $0 | $0 | $0 | $390,928 | $313,027 |
| 45 | Saving | $390,928 | $12,000 | $23,193 | $0 | $0 | $0 | $426,121 | $332,885 |
| 46 | Saving | $426,121 | $12,000 | $25,252 | $0 | $0 | $0 | $463,373 | $353,157 |
| 47 | Saving | $463,373 | $12,000 | $27,432 | $0 | $0 | $0 | $502,805 | $373,863 |
| 48 | Saving | $502,805 | $12,000 | $29,739 | $0 | $0 | $0 | $544,544 | $395,023 |
| 49 | Saving | $544,544 | $12,000 | $32,181 | $0 | $0 | $0 | $588,725 | $416,657 |
| 50 | Saving | $588,725 | $12,000 | $34,767 | $0 | $0 | $0 | $635,492 | $438,785 |
| 51 | Saving | $635,492 | $12,000 | $37,503 | $0 | $0 | $0 | $684,995 | $461,430 |
| 52 | Saving | $684,995 | $12,000 | $40,400 | $0 | $0 | $0 | $737,394 | $484,612 |
| 53 | Saving | $737,394 | $12,000 | $43,466 | $0 | $0 | $0 | $792,860 | $508,355 |
| 54 | Saving | $792,860 | $12,000 | $46,711 | $0 | $0 | $0 | $851,571 | $532,681 |
| 55 | Saving | $851,571 | $12,000 | $50,146 | $0 | $0 | $0 | $913,718 | $557,615 |
| 56 | Saving | $913,718 | $12,000 | $53,783 | $0 | $0 | $0 | $979,500 | $583,181 |
| 57 | Saving | $979,500 | $12,000 | $57,632 | $0 | $0 | $0 | $1,049,132 | $609,404 |
| 58 | Saving | $1,049,132 | $12,000 | $61,706 | $0 | $0 | $0 | $1,122,839 | $636,310 |
| 59 | Saving | $1,122,839 | $12,000 | $66,019 | $0 | $0 | $0 | $1,200,858 | $663,925 |
| 60 | Saving | $1,200,858 | $12,000 | $70,584 | $0 | $0 | $0 | $1,283,442 | $692,277 |
| 61 | Saving | $1,283,442 | $12,000 | $75,417 | $0 | $0 | $0 | $1,370,859 | $721,393 |
| 62 | Saving | $1,370,859 | $12,000 | $80,532 | $0 | $0 | $0 | $1,463,390 | $751,304 |
| 63 | Saving | $1,463,390 | $12,000 | $85,946 | $0 | $0 | $0 | $1,561,336 | $782,039 |
| 64 | Saving | $1,561,336 | $12,000 | $91,677 | $0 | $0 | $0 | $1,665,013 | $813,627 |
| 65 | Saving | $1,665,013 | $12,000 | $97,743 | $0 | $0 | $0 | $1,774,756 | $846,102 |
| 66 | Saving | $1,774,756 | $12,000 | $104,165 | $0 | $0 | $0 | $1,890,921 | $879,495 |
| 67 | Saving | $1,890,921 | $12,000 | $110,962 | $0 | $0 | $0 | $2,013,883 | $913,841 |
| 67 | Retired | $2,013,883 | $0 | $110,269 | $52,890 | $132,225 | $79,335 | $2,044,817 | $905,246 |
| 68 | Retired | $2,044,817 | $0 | $111,919 | $54,212 | $135,531 | $81,319 | $2,075,418 | $896,384 |
| 69 | Retired | $2,075,418 | $0 | $113,548 | $55,568 | $138,919 | $83,352 | $2,105,614 | $887,245 |
| 70 | Retired | $2,105,614 | $0 | $115,150 | $56,957 | $142,392 | $85,435 | $2,135,329 | $877,820 |
| 71 | Retired | $2,135,329 | $0 | $116,722 | $58,381 | $145,952 | $87,571 | $2,164,479 | $868,101 |
| 72 | Retired | $2,164,479 | $0 | $118,259 | $59,840 | $149,601 | $89,761 | $2,192,978 | $858,079 |
| 73 | Retired | $2,192,978 | $0 | $119,755 | $61,336 | $153,341 | $92,005 | $2,220,729 | $847,744 |
| 74 | Retired | $2,220,729 | $0 | $121,206 | $62,870 | $157,174 | $94,305 | $2,247,630 | $837,086 |
| 75 | Retired | $2,247,630 | $0 | $122,605 | $64,442 | $161,104 | $96,662 | $2,273,573 | $826,096 |
| 76 | Retired | $2,273,573 | $0 | $123,946 | $66,053 | $165,131 | $99,079 | $2,298,440 | $814,762 |
| 77 | Retired | $2,298,440 | $0 | $125,222 | $67,704 | $169,260 | $101,556 | $2,322,107 | $803,075 |
| 78 | Retired | $2,322,107 | $0 | $126,427 | $69,396 | $173,491 | $104,095 | $2,344,439 | $791,023 |
| 79 | Retired | $2,344,439 | $0 | $127,551 | $71,131 | $177,828 | $106,697 | $2,365,293 | $778,594 |
| 80 | Retired | $2,365,293 | $0 | $128,588 | $72,910 | $182,274 | $109,365 | $2,384,517 | $765,777 |
| 81 | Retired | $2,384,517 | $0 | $129,528 | $74,732 | $186,831 | $112,099 | $2,401,946 | $752,561 |
| 82 | Retired | $2,401,946 | $0 | $130,362 | $76,601 | $191,502 | $114,901 | $2,417,406 | $738,931 |
| 83 | Retired | $2,417,406 | $0 | $131,079 | $78,516 | $196,289 | $117,774 | $2,430,712 | $724,877 |
| 84 | Retired | $2,430,712 | $0 | $131,670 | $80,479 | $201,197 | $120,718 | $2,441,663 | $710,383 |
| 85 | Retired | $2,441,663 | $0 | $132,122 | $82,491 | $206,227 | $123,736 | $2,450,049 | $695,437 |
| 86 | Retired | $2,450,049 | $0 | $132,424 | $84,553 | $211,382 | $126,829 | $2,455,644 | $680,024 |
| 87 | Retired | $2,455,644 | $0 | $132,562 | $86,667 | $216,667 | $130,000 | $2,458,205 | $664,130 |
| 88 | Retired | $2,458,205 | $0 | $132,522 | $88,833 | $222,083 | $133,250 | $2,457,478 | $647,740 |
| 89 | Retired | $2,457,478 | $0 | $132,291 | $91,054 | $227,635 | $136,581 | $2,453,187 | $630,838 |
| 90 | Retired | $2,453,187 | $0 | $131,852 | $93,331 | $233,326 | $139,996 | $2,445,044 | $613,409 |
| 91 | Retired | $2,445,044 | $0 | $131,188 | $95,664 | $239,160 | $143,496 | $2,432,736 | $595,435 |
| 92 | Retired | $2,432,736 | $0 | $130,282 | $98,055 | $245,139 | $147,083 | $2,415,935 | $576,901 |
| 93 | Retired | $2,415,935 | $0 | $129,115 | $100,507 | $251,267 | $150,760 | $2,394,290 | $557,787 |
| 94 | Retired | $2,394,290 | $0 | $127,666 | $103,019 | $257,549 | $154,529 | $2,367,427 | $538,077 |
Retirement Plan Audit
Scenario RC-4572C39F · engine v2.0.0 · seed 1234567 · generated 2026-08-04
Verdict
Reconciliation
| Basis | Projected | Target | Margin | Residual |
|---|---|---|---|---|
| Nominal | $2,013,883 | $1,720,841 | +$293,042 | 0 |
| Real (today’s $) | $913,841 | $780,867 | +$132,974 | 0 |
Modeled target & failure mode
Decision boundaries
Your plan clears the 85% threshold. These are its decision boundaries — push any value just past its limit and the plan drops below threshold.
| Boundary | Limit |
|---|---|
| Maximum sustainable annual spending | $66,130 / yr (+$6,130 vs current) |
| Earliest retirement age | age 65 (-2 yrs vs current) |
| Minimum monthly contribution | $731 / mo (-$269 vs current) |
| Maximum annual fee | 0.7% (+0.4 pts vs current) |
| Maximum plan-through age | age 103 (+8 yrs vs current) |
| Maximum legacy target | $302,826 (+$302,826 vs current) |
Worst historical replay
Replaying the worst starting year the market dataset contains (1965) against your plan, in real dollars:
Derived from the same historical real-return sequence the backtest identifies as the worst starting year — not a hardcoded date.
Assumptions & reproduction
Datasets
Assumptions
- Contributions compound monthly and are added at the end of each month; the drawdown withdraws at the start of each retirement year.
- Spending is entered in today's dollars and inflated to nominal amounts each year at the inflation input.
- Guaranteed income (Social Security, pension) is netted against spending; only the remaining gap is funded from the portfolio.
- The historical backtest and probabilistic simulation model the retirement drawdown against real (inflation-adjusted) returns blended from the market dataset at your stocks/bonds allocation (default 60/40), starting from the real balance at retirement.
- The probabilistic simulation uses a fixed seed, so the same inputs always reproduce the same modeled success rate.
- The engine applies no taxes; annual spending and guaranteed income are treated as after-tax amounts available for spending.
Limitations
- Returns are planning assumptions, never forecasts; actual returns vary year to year and can be negative.
- A modeled success rate is the share of simulated paths that funded the plan — it is not a probability guarantee.
- The engine applies no taxes and no effective tax rate; enter spending and guaranteed income as after-tax amounts. It does not model RMDs, Roth conversions, Social Security claiming or account-withdrawal ordering.
- Social Security values should be confirmed with the SSA; this tool does not compute a benefit from your earnings history.
- The bound datasets are provisional and awaiting editorial verification against their publishers.
How much do I need to retire?
Start from the gap between your after-tax spending and any guaranteed income. The rule of 25 — 25 times your annual portfolio-funded spending — is a quick equivalent of a 4% initial withdrawal, but Social Security and pensions reduce the capital you need, while fees and a legacy target raise it. The page also reports a modeled target: the minimum real balance that clears your success threshold in the simulation, which can differ from the rule of 25.
Does my plan hold up?
Compare your projected real balance with the modeled target, and read the margin of safety from the modeled success rate rather than the point estimate. A plan can clear a deterministic target yet fail in many historical sequences — that gap is the difference between an average-return projection and a stress-tested one. The verdict summarises both.
When can I retire?
The earliest age depends on your balance, saving rate, spending, guaranteed income, plan-through age and how much risk you will accept. The solver returns the first whole age meeting your success threshold; lowering spending or the threshold moves it earlier.
How long will my money last?
A fixed-period amortization answers one version of the question; inflation-adjusted spending, variable returns, sequence risk and a legacy target answer the harder one. The deterministic depletion age and the modeled success rate together give the honest picture.
The 4% rule and safe withdrawal rates
The 4% rule withdraws 4% in year one and adjusts for inflation thereafter, tested historically over roughly 30 years for a stock/bond mix. Horizon, allocation, fees and spending flexibility all move the sustainable rate. Historical success is not a guarantee, and "safe withdrawal rate" does not mean guaranteed.
Sequence-of-returns risk
Two retirements with the same average return can end very differently: a poor market in the first few years, while withdrawals drain the portfolio, does damage a later recovery cannot undo. The historical crisis replay shows the worst starting year in the dataset against your own plan, in real dollars.
Nominal vs real dollars
Spending is entered in today’s dollars and grown to nominal amounts each year; balances are shown in both nominal and today’s dollars so the two are never confused. The historical and probabilistic simulators spend a constant amount in real dollars, so they start from the real balance at retirement — never the larger nominal figure — and the reconciliation table makes the identity explicit.
What this tool does not do
The engine applies no taxes and no effective tax rate: enter spending and guaranteed income as after-tax amounts available to spend. It does not model required minimum distributions, Roth conversions, Social Security claiming strategy, account-withdrawal ordering, a full cash-flow timeline, dynamic spending guardrails or couples planning. Those are deliberately out of scope for this page.
One profile, every retirement answer
A single canonical page answers the questions that are usually split across separate tools: how much you need, whether you are on track, when you can retire, what income you can take, how long the money lasts, and whether a 4% withdrawal is reasonable. The intent selector changes which answer leads; it never loads a different dataset or a different page.
Because all six answers come from one simulation, they always agree. The retirement number you see in the 'how much' view is the same target the 'on track' view measures your projection against.
The result distinguishes nominal dollars from today's dollars everywhere, so a large future balance is never confused with its real purchasing power.
Three perspectives, not one
The deterministic projection answers the arithmetic questions under the exact return and inflation you enter. It is precise but assumes markets deliver the same return every year, which they do not.
The historical backtest re-runs your drawdown starting in every year the market dataset covers, so you see how the plan would have fared through the Depression, the 1970s and 2008 — and which starting years were worst.
The probabilistic simulation resamples historical real returns in multi-year blocks across thousands of paths and reports the share that funded your plan. It is reproducible: the same inputs and seed always return the same rate.
Sequence-of-returns risk
Two retirements with the same average return can end very differently depending on the order of returns. A poor market in the first few years of retirement, while withdrawals are draining the portfolio, does lasting damage that a later recovery cannot fully repair.
This is why the historical and probabilistic views matter: they expose the fragility that an average-return projection hides. The stress-test panel makes the effect explicit by starting retirement in a major historical decline.
A plan that succeeds deterministically but fails in a large share of historical sequences is not a safe plan; it is a plan that depends on a calm early retirement.
Methodology and formulas
ending = opening + contributions + return − fees — monthly compounding, contributions at end of month, fees netted from the return.nominal(t) = real × (1 + i)^t — today’s-dollar spending grown to each year.real = nominal ÷ (1 + i)^years — the basis the historical and probabilistic simulators consume.portfolio-funded = spending − guaranteed income — if negative, no forced withdrawal.nest egg ≈ funded spending × 25 — the 4% first-year-withdrawal heuristic, shown alongside the modeled target.projected − target = margin — reported in both nominal and today’s dollars with a residual under $0.01.PMT = PV · r / (1 − (1 + r)^−n).Convention: withdrawals occur at the start of each retirement year; a zero-return, zero-inflation plan reduces to linear cash flows. The engine applies no taxes.
Frequently asked questions
How much money do I need to retire?
Enough to fund the gap between your spending and any guaranteed income for as long as the plan runs. A quick heuristic is 25 times your annual portfolio-funded spending (the rule of 25, equivalent to a 4% initial withdrawal); the tool shows this alongside the deterministic and probabilistic targets, which can differ.
Can I retire with $1 million?
It depends on your spending, guaranteed income, age and horizon. Enter $1,000,000 as your savings: the tool reports the sustainable spending it supports, the first-year withdrawal at your chosen rate, and the share of historical and simulated paths in which it funds your plan to your plan-through age.
How long will $1 million last in retirement?
Enter the balance, your spending and return assumptions. The deterministic view shows the depletion age; the historical and probabilistic views show how long it lasted across real market sequences, including the worst starting years, rather than a single figure.
What is the 4% rule?
Withdraw 4% of the portfolio in the first year of retirement, then adjust that dollar amount for inflation each year. It is a historical rule of thumb for a roughly 30-year horizon and a stock/bond mix. The tool shows it beside a real drawdown so you can see where they agree and differ.
Is the 4% rule guaranteed?
No. It is based on historical U.S. returns over past 30-year windows, not a guarantee. Different horizons, allocations, fees or a poor sequence of early returns can make it too high or too low. 'Safe withdrawal rate' does not mean a guaranteed withdrawal rate.
How much should I save each month?
The solver reports the smallest additional monthly contribution that lifts your modeled success rate to your chosen threshold. It searches by re-running the full simulation, so the figure reflects your spending, income, fees and horizon — not a generic rule.
What age can I retire?
The earliest-age solver simulates each whole age from next year onward and returns the first that meets your modeled success threshold, given your savings, contributions, spending, guaranteed income and horizon.
How does inflation affect retirement savings?
It raises the nominal cost of the same lifestyle every year and erodes the purchasing power of a fixed balance. The tool inflates today's-dollar spending to nominal amounts, and always reports balances in both nominal and today's dollars so the two are never confused.
Does the calculator include Social Security?
Yes, as a guaranteed income you enter. It is netted against spending so only the remaining gap is funded from the portfolio. Confirm your benefit with the SSA; this tool does not compute it from your earnings history.
Does it include taxes?
No. The engine applies no taxes and no effective tax rate. Enter your annual spending and guaranteed income as after-tax amounts — the figures you actually have available to spend. It does not model RMDs, Roth conversions, Social Security claiming or the order in which accounts are drawn down.
What return should I assume?
A planning assumption you choose, not a forecast. Many planners use a real return well below recent stock-market averages to leave a margin of safety. Try a lower return in the stress test to see how fragile the plan is.
Why does the historical result differ from the probabilistic one?
The historical backtest uses the actual, ordered sequence of past returns; the probabilistic simulation resamples those returns in blocks across many synthetic paths. They answer slightly different questions, so two correct methods can report different success rates.
Data sources, review status and versions
- Aswath Damodaran (NYU Stern) — compiled from S&P, Federal Reserve and BLS series — dataset
retirement-market-history-2026· coverage 1928–2024 · as of December 31, 2024 · retrieved January 15, 2026 · Dataset verification pending - U.S. Social Security Administration — Office of the Chief Actuary — dataset
ssa-life-tables-2026· coverage n/a · as of December 31, 2025 · retrieved January 15, 2026 · Dataset verification pending
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Evidence, sources and editorial review
Retirement Stress Test: See What Could Break Your Plan groups its evidence and methodology review here so sources, assumptions and responsibility can be checked together.
References & authoritative sources
- Social Security Administration — Retirement benefit estimator and period life tables (Trustees Report 2026) · consulted January 15, 2026 · Life-expectancy reference for the plan-through helper; benefit amounts should be confirmed with the SSA estimator
- Bureau of Labor Statistics — Consumer Price Index for All Urban Consumers (CPI-U) · consulted January 15, 2026 · Definition of the inflation measure used to convert today's dollars to nominal amounts
- Aswath Damodaran (NYU Stern) — Historical Returns on Stocks, Bonds and Bills, 1928–2024 · consulted January 15, 2026 · Annual return series used for the historical backtest and block-bootstrap simulation
- Bengen, W. (1994), Journal of Financial Planning — Determining Withdrawal Rates Using Historical Data · consulted January 15, 2026 · Origin of the 4% initial-withdrawal rule of thumb discussed in the withdrawal-rate section
Methodology & review
Engine version: 2.0.0 · Last updated: · Review: Independent financial and technical review pending; bound datasets awaiting editorial verification.
Data status: the bound market-history and life-expectancy datasets are provisional and awaiting editorial verification against their publishers — treat the figures as educational estimates. This tool is not financial advice.
One deterministic simulation backs every answer: it projects savings to retirement with monthly compounding net of fees, converts today's-dollar spending to nominal amounts each year, nets guaranteed income against spending to find the portfolio-funded gap, and draws the portfolio down to the plan-through age. Because the projected balance at retirement is nominal while the risk simulators spend a constant amount in real (today's) dollars and compound real returns, those simulators are fed the real balance at retirement, never the nominal one. The same normalized plan is re-run two more ways — a historical sequence backtest over every start year in a versioned market dataset, and a reproducible block-bootstrap of historical real returns (fixed seed) — so the page reports a modeled success rate and a modeled required balance, not a single number. A binary search on the real balance finds the minimum needed to clear the chosen success threshold; further searches return the plan's decision boundaries when it clears the threshold, or its rescue options when it does not, and a failure-mode audit ranks the stresses by how much success they cost. The engine applies no taxes: spending and guaranteed-income figures are treated as after-tax amounts available for spending. Every market and life-expectancy figure comes from versioned datasets; none is written into the page copy. Returns are planning assumptions, not forecasts, and a modeled success rate is not a guarantee. Educational estimates, not individual investment, tax or legal advice.
Assumptions
- Contributions compound monthly and are added at the end of each month; the drawdown withdraws at the start of each retirement year.
- Spending is entered in today's dollars and inflated to nominal amounts each year at the inflation input.
- Guaranteed income (Social Security, pension) is netted against spending; only the remaining gap is funded from the portfolio.
- The historical backtest and probabilistic simulation model the retirement drawdown against real (inflation-adjusted) returns blended from the market dataset at your stocks/bonds allocation (default 60/40), starting from the real balance at retirement.
- The probabilistic simulation uses a fixed seed, so the same inputs always reproduce the same modeled success rate.
- The engine applies no taxes; annual spending and guaranteed income are treated as after-tax amounts available for spending.
Limitations
- Returns are planning assumptions, never forecasts; actual returns vary year to year and can be negative.
- A modeled success rate is the share of simulated paths that funded the plan — it is not a probability guarantee.
- The engine applies no taxes and no effective tax rate; enter spending and guaranteed income as after-tax amounts. It does not model RMDs, Roth conversions, Social Security claiming or account-withdrawal ordering.
- Social Security values should be confirmed with the SSA; this tool does not compute a benefit from your earnings history.
- The bound datasets are provisional and awaiting editorial verification against their publishers.
Reviewed according to the CalcDomain Editorial Policy & Calculator Methodology. We document formulas, edge cases, sources, update dates, and correction paths for calculator pages.