Retirement Risk Model

The retirement risk model uses stochastic analysis to understand the risks in a retirement plan. For example, what is the likelihood that a retirement portfolio will be exhausted — drop to zero — at some point in the future?

How to use it:

  1. Set information on basic income and expenses on the Retirement Model tab.

  2. List investments on the Portfolio tab. See the example models for how to model simple and complex portfolios.

  3. Then look at the Report and Analysis tabs to see how the model plays out in simulation.

You can always make changes to the various inputs and click back to the report to see how they affect the model.

Two last notes: use control-Z to undo changes; and if you accidentally reload the page, your data will be saved.

File Options

Load or save files to your desktop, or clear the model to restart.

Load ModelSave ModelReset Model

Example Models

Two sample models show how to use the risk analysis with different levels of complexity. Returns and correlations in the examples are invented and are presented for illustration only.

Simple Example (Basic Functions Only)

Complex Example (Includes correlated assets and income/expense items)

Random Number Generator

Set a seed value for the random number generator and re-run the simulation model. This can be useful if you want to get reproducible results.

A seed value of zero (0) will use the current system time.

What is the risk that your retirement funds will run out during your lifetime?

How much can you expect to have when you retire?

10 years after retirement...

How did we calculate this?

Continue to Analysis


The following are based on running 2,500 trials in a simulation. In this model, the portfolio balance cannot fall below zero. As a result, the average (or mean) value may understate risk. The median value is a more reliable indicator. When the median falls to zero in a given year, that means there is a 50% or greater that the portfolio balance will be zero.

Please note: in the tables below, figures are truncated to two significant digits for readability. See the "data" tab for precise values.

Terminal Analysis

Year of death is calculated randomly, using the US Social Security Administration's 2010 mortality tables and the birth year / sex given in the retirement model tab.

Here, risk of exhaustion means the likelihood that the portfolio value fell to zero before the year of death.

Annual Results

Simulation Information

Re-run SimulationExport Data (CSV)Data set: