Probability of Success

This is the main number that comes out of the analysis. Simply put, it is the percent of the simulated paths that were able to meet all of the goals in the plan. In other words, if 100 out of the 1,000 paths ran out of money before the end of the simulation, the plan would have a 90% probability of success.

This is a good starting point, but it doesn’t tell you how extreme the outcomes are going to be. It’s one thing if your retirement plan is running out of money at the age of 105. It’s a very different thing if that plan is running out of money at the age of 75.

The probability of success is the starting point. If a plan doesn’t have a high enough probability of success, then a deeper dive might be necessary to ensure that you have a solid plan.

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