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Monte Carlo Retirement Simulation

Traditional retirement calculators give you one answer: with 5% annual returns, you'll have X in 30 years. But markets don't deliver average returns every year — some years +20%, some −15%. Monte Carlo runs 1,000 random scenarios and reports success probability, not a single number.

Inputs

Amount withdrawn each year; scaled by inflation during the simulation.

Market assumptions

Standard deviation reflects market volatility. Historical 60/40 portfolio: ~10–12%; all-equity: ~15–18%.

Monte Carlo uses random sampling, so each run varies slightly.

Simulation results
Success rate
66.4%
664 of 1000 simulations did not exhaust the portfolio within 30 years.
Asset distribution after 30 years
Worst 10% (P10)NT$0
Median (P50)NT$6.97M
Best 10% (P90)NT$51.43M
How to read this
  • Success rate ≥ 90%: most scenarios sustainable.
  • Success rate 75–90%: elevated risk; consider lower withdrawals or delayed retirement.
  • Success rate < 75%: current plan may be hard to maintain long term.

Monte Carlo assumes normally distributed, independent yearly returns. Real markets have fat tails (black swans) and sequence-of-returns risk; treat results as a probability reference only.

Asset trajectory (median with 10th–90th percentile band)

The line is the median path across 1,000 simulations; the shaded band spans the 10th to 90th percentiles — 80% of simulated outcomes fall within it. A wider band means greater market uncertainty.

Success rate interpretation

  • ≥ 95%: robust plan, executable as-is
  • 85–95%: acceptable, small risk of adjustment
  • 75–85%: meaningful risk, consider backup plans
  • < 75%: unlikely to sustain, reduce withdrawals or delay retirement

The 4% rule aims for 95%+ success — see Trinity Study article.

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