figure 4 on page 259
On Fig. 4 Dr. Ruth's Percentile Distribution of Living Standard has the lines curving up --persumably by her spending less. I have not been able to determine the inputs needed to model this. As far as I can tell, the Monte Carlo charts always reflect the recommended amounts and not the actual. I tried to replicate the effect by inputting additoinal savings to force spending down, but the chart turns out the same as it did without hte spending behavior change. What am I missing here?
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I have the same question. How did Larry/Scott create figure 4?
I've used the method mentioned by the previous poster, but am curious to find out how the authors did it.
That particular figure is not created in one pass. That is to say, the authors used two charts and imposed one on the other because they wanted to show a comparison of All TIPs to this other spending pattern, so they took the one set of numbers and combined them with the all TIPs number to create the single chart. Otherwise, they would have had to say, first look at this chart--notice where the TIPS living standard line is--now look at this other chart, and imagine the TIPs line running along the axis at this or that level. It was more clear to just combine the charts as one.
So you can't really replicate that chart per se with one set of adjustments.
I hope that makes sense.
What was not mentioned in this thread is that you can model "spending defensively if you invest aggressively" by lowering your standard of living to say 90% in the present year, and then gradually ramping it up (growing it) by a small percetage each year. Use the grow button (experiment) until it creates the kind of living standard curve that you want. The chart will tilt upward to the right as you do so.
--Dan