Why You Should Avoid Simplistic Monte Carlo Results and Create a Real Financial Plan Instead

Comments · 19

• MA

  @MatrixMatched · 1 year ago

  You are always right on point, James. &nbsp;When u did the makeover for me, we determined that although the Monte Carlo analysis was high, I needed to get out of the index fund to separate the stocks &amp; bonds so I wasn’t forced to sell stocks during a downturn.<br>I’ve implemented your suggestions. &nbsp;I’m doing my job part time in 2025 rather than fully retiring. &nbsp;After a few months, the retirement journey will really begin.<br><br>Thanks again for your help. &nbsp;When I get to the $2 mil, u will be my advsior

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• GO

  @gocartz1468 · 1 year ago

  Most financial planning info I&apos;ve read or seen uses 80% for monte carlo analysis with the flexibility of changing how you&apos;re spending money in retirement

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• KE

  @kensalmon7331 · 1 year ago

  I saved so much for retirement that a Monte Carlo analysis is worthless to me. I need all of the other help that James outlines such as tax efficiency, avoiding IRMA, etc. great job James!

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• JA

  @James4cycling · 1 year ago

  It’s impossible for a Monte Carlo analysis to be 100% accurate. You’re inputting assumptions about: inflation; stock market returns; interest rates; medical inflation; Medicare premiums; Social Security benefits; etc. There’s so many variables I wouldn’t trust any results more than 5 years out. But it is better than sticking your head in the sand and hoping for the best.

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• FA

  @fanfavorite4737 · 1 year ago

  Good stuff and a great reminder to keep the Monte Carlo results in perspective and not let it completely own your retirement decisions. &nbsp;Every time we meet with our advisor and we chat about our Monte Carlo results, I cringe a bit because I think the rate of success is too high, based off our current withdrawal rate projections. &nbsp;It’s modeled on an assumed “down market” over the next 30-40 years…..and all the way out til I’m 100 years old. &nbsp;I have zero track record of folks in my family living that long…..so either we need to spend more money in retirement or we should have retired years ago. &nbsp;This video has inspired more conversations with our advisor. &nbsp;Thanks James.

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• JA

  @jameschaves5723 · 1 year ago

  I follow many YouTube financial channels and I have the most confidence in ROOT.

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• JT

  @JT-eq8ze · 1 year ago

  Excellent job with explaining a complex subject, as usual!

• ER

  @ericgold3840 · 1 year ago

  YES !! So well said<br>I would like to see Monte Carlo overlaid on top of a sensitivity analysis. We need some accuracy along with our precision

• JA

  @janethunt4037 · 1 year ago

  Thank you, James, for this excellent explanation.

• FI

  @firstchoicefarm7767 · 11 months ago

  James, good talk on the Monte Carlo analysis, &nbsp;but how about getting more nerdy and telling us about RC&apos;s details on accuracy. &nbsp; What probability distribution function is used? &nbsp;Is it based upon historical rates? &nbsp;Inflation and market returns. &nbsp;How about connection between them? &nbsp;How about dependence of prior year?

• TA

  @taravamos2954 · 1 year ago

  Mic quality is worse than usual and stripy background is distracting. &nbsp;Content is good as usual.

• AL

  @alanwong8307 · 1 year ago

  @James Conole, CFP®, how is your paid &quot;Early Retirement Academy&quot; featuring the Right Capital Software different than the offer from Ari Taublieb? &nbsp;How is the software and your videos different from Ari&apos;s version?