Financial Goals Calculator
Monte Carlo simulation for life-stage planning
Plan your financial future with confidence using advanced Monte Carlo simulations. Model multiple life goals — retirement, children's education, major purchases — and see the probability of achieving them under thousands of different market scenarios. Choose from four simulation models and customize your asset allocation glide path.
Open Source & Transparent
All calculations are open source and verifiable on GitHub. We believe in transparency and welcome contributions to improve our tools.
Monte Carlo Simulation Result
Excellent Success Probability1,000 simulations
100.0%
Median Final Balance
$49.7M
10th Percentile
$18.5M
90th Percentile
$138.8M
Portfolio & Timeline
Contributions & Withdrawals
Withdrawal rate: 10.00%
Simulation Model
More simulations = more accurate but slower
Asset Allocation
Use Glide Path
Gradually shift to bonds near retirement
Transition starts 10 years before retirement
Understanding Monte Carlo Simulations
Traditional financial calculators assume a fixed annual return (like 7% per year), which creates unrealistic straight-line projections. In reality, markets are volatile — some years return +30%, others -20%. Monte Carlo simulations embrace this uncertainty by running thousands of scenarios with random market returns based on historical patterns or your specified assumptions.
Instead of telling you "You'll have $2 million at retirement," a Monte Carlo simulation tells you "There's a 92% chance you'll have at least $1.5 million." This probability-based approach gives you a much more realistic view of your financial future and helps you understand the range of possible outcomes.
The Four Simulation Models
Historical Returns
Uses actual historical market returns to simulate future scenarios. Each simulation randomly samples from real historical periods, preserving the correlations between stocks and bonds that existed in actual markets.
Best for: Conservative planning based on what actually happened in the past.
Forecasted Returns
Uses your specified expected returns but applies historical volatility patterns. Useful when you believe future returns will differ from historical averages (e.g., lower expected returns due to high valuations).
Best for: Forward-looking assumptions with realistic volatility.
Statistical Returns
Samples from a normal distribution using historical mean returns and standard deviations. Creates smooth, mathematically-modeled returns that match the statistical properties of historical data.
Best for: Academic-style analysis with clean statistical properties.
Parameterized Returns
Full control: specify both expected returns AND standard deviations for each asset class. Useful for stress testing specific scenarios or using assumptions from financial research.
Best for: Custom scenarios and stress testing with precise control.
Understanding Glide Paths
A glide path automatically adjusts your asset allocation over time. The classic example is target-date retirement funds, which shift from aggressive (high stocks) to conservative (high bonds) as you approach retirement.
90%
Early Career Stocks
Start aggressive with decades to recover from downturns.
→
Linear Transition
Gradually shift each year toward your target allocation.
40%
Retirement Stocks
End conservative to protect against sequence risk.
Example: Starting at 90% stocks and ending at 40% over 30 years means reducing stock allocation by ~1.67% per year automatically.
Modeling Life-Stage Goals
Real financial planning involves multiple goals across different life stages. This calculator lets you model the full picture:
| Life Stage | Example Goal | Cashflow Type | Years |
|---|---|---|---|
| Accumulation | Retirement Savings | +$30,000/year | Years 1-25 |
| Kids in College | Education Funding | -$40,000/year | Years 15-22 |
| Early Retirement | Living Expenses | -$60,000/year | Years 26-35 |
| Social Security | Reduced Withdrawals | -$35,000/year | Years 36-50 |
| Legacy | Estate Goal | $500,000 target | Year 50 |
Tip: Enter contributions as positive numbers and withdrawals as negative numbers. All amounts can be specified in today's dollars — the simulation adjusts for inflation.
Interpreting Your Success Rate
90%+
Excellent
High confidence for critical goals like retirement income.
80-89%
Good
Acceptable for flexible goals; consider building a cushion.
<80%
Needs Work
Consider adjustments: save more, spend less, or work longer.
Remember: A 90% success rate means 1 in 10 simulations failed — not zero risk. Consider building in flexibility (ability to reduce spending, part-time work options, or adjustable legacy goals) as a safety margin.
Understanding Percentile Projections
The calculator shows your portfolio value at different percentiles across all simulations:
Planning tip: Don't plan based on median or best-case outcomes. Instead, ensure you can live with the 10th or 25th percentile results.
Important Considerations
- Models are simplifications. Real markets have fat tails, regime changes, and correlations that vary over time. No model perfectly captures all market behavior.
- Historical returns may not repeat. Especially for bonds, current low yields suggest future returns may be lower than historical averages.
- Taxes and fees matter. This calculator shows pre-tax, pre-fee results. Factor in your actual costs when planning.
- Life is uncertain. Health issues, career changes, inheritance, and other life events can significantly impact your plan. Build in flexibility.
- Review regularly. Update your projections annually or when major life changes occur. A plan is only as good as its inputs.
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