Income Tax Comparison
Lawyer in Romania
Simulation Overview
Base scenario assumptions
- The simulation starts at age 30 and runs until age 65.
- The initial annual income is €18,000.
- Income grows annually at an average rate of 3%.
- The income tax rate varies between 0% and 30%.
- The saving rate is set to 40%.
- Minimum annual living expenses are €9,000.
- Savings are invested with stochastic annual returns.
- The average annual return is 6%, with year-to-year variability.
- All values are expressed in real terms, assuming average annual inflation of 3%.
- The simulation includes stochastic life events such as unemployment, and health issue.
- These events may temporarily affect income, expenses, or net worth.
- Financial independence is defined as having net worth equal to 25 times annual expenses.
- Bankruptcy is triggered if net worth remains below €0 for 2 consecutive years.
Scenario Comparison
Results are shown as a realistic range. P10 represents a pessimistic outcome, while P90 represents an optimistic outcome.
| Scenario | Median Net Worth | P10 Net Worth | P90 Net Worth | FI Probability | FI Median Age |
|---|---|---|---|---|---|
| 0% | 1,139,995.225 | 726,280.239 | 1,792,687.9340000001 | 100% | 45 |
| 10% | 1,025,995.7050000001 | 653,652.208 | 1,613,419.137 | 100% | 46 |
| 20% | 911,996.1799999999 | 581,024.186 | 1,434,150.3490000002 | 100% | 47 |
| 30% | 797,996.6599999999 | 508,396.16400000005 | 1,254,881.5520000001 | 100% | 49 |
How Your Financial Life Evolves
These charts show how each scenario affects long-term outcomes, including expected wealth, downside risk, and the likelihood of achieving financial independence.
Net Worth Median
Net Worth Range
Fi Probability
Fi Median Age
