Question 1

What success rate should I aim for in a Monte Carlo retirement simulation?

Accepted Answer

Most planners consider 80–90% a solid target. Below ~75% your plan is leaning on good luck; above ~95% you may be underspending. The right number depends on how flexible your spending is — if you can cut back in bad years, a lower rate is acceptable. This free simulator reports your rate and how it changes with retirement age, savings, and spending.

Question 2

Why use a Monte Carlo simulation instead of an average-return projection?

Accepted Answer

Averages hide the order of returns. Two retirees with identical average returns can end up in completely different places if one hits a crash early in retirement (sequence-of-returns risk). Monte Carlo runs thousands of randomized paths so bad-timing scenarios show up in the success rate instead of being averaged away.

Retirement Monte Carlo Simulator