Why one projection
line is a lie
Every spreadsheet retirement calculator draws a single line from today to your planning age and says "you'll have $X." But markets don't move in straight lines. Monte Carlo is the honest alternative.
The problem with one line
Traditional retirement calculators ask "what's the expected return?" and assume markets deliver exactly that every year. If you say 7%, they model every year as +7%. Then they add contributions and subtract withdrawals in a tidy, deterministic path.
The problem: this doesn't happen. Markets return +30% one year, −20% the next, +15%, −40%, +25%... The average might be 7% over 30 years, but the order and magnitude of those swings has a dramatic effect on your actual outcome — especially around retirement.
How Monte Carlo works
Instead of one path, Monte Carlo runs hundreds or thousands of independent simulations. Each one samples a random return for each year from a realistic distribution — some years great, some terrible, most somewhere in the middle. After running all simulations, we count what fraction of futures end with money left.
The success rate is simply: what fraction of the 2,000 simulated futures ended with money still in the portfolio at your planning age? An 85% success rate means 1,700 out of 2,000 futures worked out — 300 didn't.
Try it yourself
Adjust the expected return and volatility below. Watch how paths spread out when uncertainty is high, and converge when it's low. Switch between "All paths" (every simulated future) and "Fan chart" (the same data summarized by percentile bands).
$250k savings · $2k/mo contributions · Retire at 65 · $80k/yr withdrawals · 600 simulations
Reading the fan chart
Plotting 2,000 individual lines is noisy. The fan chart summarizes them into percentile bands — each band shows where a specific fraction of outcomes land at each age.
| Band | Meaning | What to think |
|---|---|---|
| P90 (top) | Best 10% of futures | Great market luck — don't count on it |
| P75 | Top 25% of futures | Better than most — still possible |
| P50 (median) | Middle outcome | The realistic central case |
| P25 | Bottom 25% of futures | Worse than most — prepare for this |
| P10 (bottom) | Worst 10% of futures | Bad luck scenario — have a plan |
Key insights
85% doesn't mean you'll probably be fine — it means 1 in 6 simulated futures failed. For a 30-year retirement, consider how you'd handle that scenario.
With 100 simulations, results jump around run to run. With 500+, the success rate stabilizes. This simulator runs 2,000 by default for reliable results.
Higher volatility doesn't just widen the fan — it lowers the median outcome too. Log-normal returns mean a 50% loss requires a 100% gain just to break even.
Your assumed stock return and volatility are the biggest inputs. Conservative assumptions (6% return, 18% vol) give very different answers than aggressive ones (10%, 22%).
Apply this to your numbers
The simulation above uses example numbers. Run a Monte Carlo with your actual savings, income needs, and retirement age to see your real odds.