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Retirement Planning Tool

Monte Carlo Portfolio Simulator

Run thousands of market simulations to analyze your portfolio's survival probability. Test retirement scenarios, withdrawal rates, and asset allocations with statistical confidence.

Up to 25,000 Simulations
Inflation Adjusted
100% Free

Portfolio Settings

Your current total investment portfolio value
Amount you add to portfolio each year (set to 0 for retirement)
Amount you withdraw each year (in today's dollars)

Withdrawal rate: 4.00%

Asset Allocation

Ready to Simulate

Configure your portfolio settings and click "Run Simulations" to see the probability distribution of outcomes.

What is Monte Carlo Portfolio Simulation?

Monte Carlo simulation is a powerful statistical technique used in financial planning to model the probability of different outcomes in a process that cannot easily be predicted due to the intervention of random variables. Named after the famous casino in Monaco, this method runs thousands of simulations using random market returns to generate a distribution of possible portfolio outcomes.

Unlike simple linear projections that assume constant returns, Monte Carlo simulations account for market volatility and the sequence of returns risk. This makes them particularly valuable for retirement planning, where the order in which returns occur can significantly impact whether your portfolio survives throughout your retirement years.

How to Use This Monte Carlo Simulator

  1. 1

    Enter Your Portfolio Value

    Input your current total investment portfolio value. This is the starting point for all simulations.

  2. 2

    Set Contributions & Withdrawals

    Enter your annual contribution (if still saving) or annual withdrawal (if in retirement). For FIRE planning, set contributions to zero and enter your expected annual spending.

  3. 3

    Choose Your Time Horizon

    Select how many years you want to simulate. For retirement planning, this is typically 25-40 years depending on your retirement age and life expectancy.

  4. 4

    Select Asset Allocation

    Choose a preset allocation or customize expected return and volatility. More aggressive allocations have higher expected returns but also higher volatility.

  5. 5

    Run Simulations & Analyze

    Click "Run Simulations" to generate thousands of possible outcomes. Review the survival rate, percentile distribution, and year-by-year projections to understand your probability of success.

Understanding Your Simulation Results

MetricWhat It MeansTarget Range
Survival RatePercentage of simulations where portfolio lasted the full period85-95%+
Median End ValueThe middle outcome - half of simulations ended higher, half lowerPositive value
10th PercentileWorst 10% of outcomes - your "bad luck" scenarioAbove $0
90th PercentileBest 10% of outcomes - your "good luck" scenarioPotential upside

Why Use Monte Carlo Simulation for Retirement Planning?

Accounts for Volatility

Unlike simple calculators, Monte Carlo simulations model real-world market ups and downs.

Sequence of Returns Risk

Captures how the order of good and bad years affects your portfolio's longevity.

Probability Distribution

See the full range of possible outcomes, not just a single "expected" result.

Inflation Adjusted

Results shown in today's dollars so you understand real purchasing power.

100% Private

All calculations run in your browser. Your financial data never leaves your device.

Export Results

Download year-by-year projections as CSV for your records or further analysis.

Frequently Asked Questions

What is a Monte Carlo portfolio simulation?

A Monte Carlo portfolio simulation is a statistical technique that runs thousands of random scenarios to predict possible future outcomes for your investment portfolio. It uses historical return and volatility data to generate probability distributions, helping you understand the range of possible outcomes and the likelihood of achieving your financial goals.

How accurate are Monte Carlo simulations for retirement planning?

Monte Carlo simulations provide probabilistic estimates rather than precise predictions. They are valuable for understanding the range of possible outcomes and identifying potential risks. However, they rely on assumptions about future returns and volatility based on historical data, which may not perfectly predict future market conditions. Use them as one tool among many in your planning process.

What is portfolio survival rate?

Portfolio survival rate represents the percentage of simulated scenarios where your portfolio maintains a positive balance throughout the entire time period. A 90% survival rate means that in 90 out of 100 simulations, your portfolio did not run out of money. Financial planners often target a survival rate of 85-95% for retirement planning.

How does inflation affect the simulation?

Inflation reduces the purchasing power of your money over time. Our simulator accounts for inflation by adjusting returns to real (inflation-adjusted) values. This means the results show your portfolio value in today's dollars, making it easier to understand your actual purchasing power in the future.

What withdrawal rate is considered safe?

The traditional "4% rule" suggests withdrawing 4% of your initial portfolio value annually (adjusted for inflation) for a 30-year retirement. However, safe withdrawal rates depend on your asset allocation, time horizon, and risk tolerance. Our simulator helps you test different withdrawal scenarios to find what works for your situation.

How many simulations should I run?

More simulations generally provide more stable and reliable results. We recommend at least 5,000 simulations for planning purposes. Running 10,000 or more simulations gives you higher confidence in the probability estimates. The trade-off is computation time, though modern browsers can handle 25,000+ simulations quickly.

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