Monte Carlo Lite
Run 1,000+ stochastic scenarios in seconds and see probability of success, percentile outcomes, and shortfall risk.
Monte Carlo Retirement Simulation
Adjust assumptions and run probabilistic projections.
Withdrawal rate: 5.00%
Moderate withdrawal pressure. Monitor success probability and shortfall risk carefully.
Return model
How this model works
- Runs many random market paths using correlated equity, bond, and cash assumptions.
- Return model options: Gaussian, fat-tail Student-t, or historical bootstrap.
- Inflation increases withdrawals each year to test real-world spending pressure.
- Success means funds remain above £0 at the end of your selected horizon.
Run a simulation to view success probability, percentile outcomes, and downside risk metrics.
Interpretation Notes
- This tool is for planning insight, not personal financial advice or guaranteed outcomes.
- Assumptions are simplified (equities/bonds/cash model) and may differ from your actual portfolio.
- Use this as a decision aid: compare scenarios, then refine with a qualified adviser.
Email Your Simulation Results
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Who Uses This Monte Carlo Tool
- Retirement drawdown sustainability planning for individuals and couples.
- Comparing two withdrawal rates before taking pension income decisions.
- Stress-testing whether the same plan still holds under higher inflation assumptions.
- Client review meetings where advisers need to explain risk ranges clearly.
How To Use This Retirement Probability Calculator
- Set initial wealth, annual withdrawal, horizon, and risk score.
- Run the simulation with at least 1,000 scenarios.
- Check probability of success and shortfall risk first.
- Use the fan chart and percentile cards to understand range, not just a single point estimate.
- Run at least one second scenario (lower withdrawal or lower risk) and compare outcomes.
Frequently Asked Questions
What is a Monte Carlo retirement calculator?
A Monte Carlo retirement calculator runs many random market scenarios to estimate how often a retirement plan succeeds over your selected time horizon.
What does probability of success mean?
It is the percentage of simulated scenarios where your portfolio did not run out of money before the end of the chosen horizon.
What do P10, P25, P50, P75, and P90 represent?
These are percentile outcomes. P10 is a weaker outcome zone, P50 is the midpoint, and P90 is a stronger outcome zone.
Is this Monte Carlo output guaranteed?
No. It is a probabilistic model based on assumptions. Markets are uncertain, and real outcomes can differ from modelled paths.
How many simulations should I use?
For practical planning, 1,000 to 5,000 simulations usually gives stable directional insight. More runs improve smoothness but take longer.
Should I read nominal or real values?
Nominal values show projected cash amounts. Real values adjust for inflation and are often better for spending-power comparisons across long horizons.
Does this model include stress testing?
Yes. Alongside the base run, the tool computes high-inflation, sequence-shock, and low-return stress snapshots to support downside planning discussions.
Is this tool financial advice?
No. This free calculator is for educational planning insight and should be reviewed with a qualified financial adviser for personal recommendations.
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