Saving Rate Comparison
Retail worker in Romania
Simulation Overview
Base scenario assumptions
- The simulation starts at age 30 and runs until age 65.
- The initial annual income is €6,300.
- Income grows annually at an average rate of 2%.
- An income tax rate of 10% is applied to gross income.
- The saving rate varies between 5% and 25%.
- Minimum annual living expenses are €9,000.
- Savings are invested with stochastic annual returns.
- The average annual return is 5%, 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, health issue, health issue, 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 |
|---|---|---|---|---|---|
| 5% | 31,852.894999999997 | 19,647.588 | 51,662.17700000001 | 0% | None |
| 10% | 63,705.795 | 39,295.186 | 103,324.36300000001 | 0% | 63 |
| 15% | 95,558.69 | 58,942.774 | 154,986.54 | 2% | 63 |
| 20% | 127,411.58499999999 | 78,590.37100000001 | 206,648.72600000002 | 8% | 62 |
| 25% | 159,264.47999999998 | 98,237.96 | 258,310.90300000005 | 20% | 62 |
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
