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Abrupt Change in Living Standard with Little Change in Retirement Assets or Income

Submitted by bandhampel@gmail.com on 29 December 2010 - 10:47am

Running Monte Carlo over a 45 year planning horizon, with 75% in bonds in the second half. Retirement asset distributions and trajectories are fairly quiet: in the range report, the retirement asset probabilities move nicely and gradually to the right over the entire horizon.

However, the "living standard" goes nuts in year 35. The median drops by more than half, and stays low for four years before rising by a factor of six, staying elevated for the last six years. All the other percentiles show similar variation.

Income and retirement assets show no similar discontinuities over the period.

So, do we really have to plan on switching to rice and beans when we hit 90, then back to caviar at 95? Or might this be a bug?

‹ Big change in the handling of user-defined assets from Oct to Dec version...why? Monte Carlo Portfolio and rates of return ›
Submitted by Dick Munroe on 2 January 2011 - 9:35pm.
1

Open a support ticket and upload your database. If you're annuitizing, there may be an issue here.

Best,

Dick Munroe

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