Chapter 1 of 2
The Monte Carlo Problem
Fiona runs her FIRE model in Worthune for the first time. Her straight-line projection says she'll have $2.1M at 42. But the Monte Carlo simulation shows a 67% success rate — meaning in 33% of scenarios, she runs out of money before 85. The problem is sequence-of-returns risk in the first decade of retirement.
Key Insight
Fiona's 67% success rate is driven by a 4.2% withdrawal rate and a 100% equity allocation. Dropping to 3.8% and adding a 20% bond allocation raises her success rate to 91% — at the cost of working 14 more months.
Model This Scenario