It was a blustery winter day, just about a year ago, when I stayed indoors all afternoon to work at my desk. The snowflakes stacked on the railing outside as I broke ground on new software, something I hadn’t done in years. It would be a modeling framework that I could use to research and analyze various retirement questions such as the best retirement withdrawal strategies and uncertainty in retirement calculations.
Despite all the time I’d spent using and reviewing retirement calculators over the years, this was the first time I’d personally tried to create one. As the snow piled up outside, I typed in the first lines of code for the fundamental modeling “loop” — the section of software that would process transactions for each year of the simulation.
Almost immediately it hit me. I was face-to-face with a mysterious problem. It was a key question that would turn out to have substantial impact on the answers produced by the calculator. And, yet, despite my extensive reviews of retirement calculators, despite the hundreds of hours I’d spent reading about and using these tools, I’d never seen anybody else raise the issue….