Suggested Consumption with and without Monte Carlo

I'm hoping this is something simple I am overlooking. With the profile I have setup I just noticed something I can't explain. I can run an analysis with just Economic-Based Planning. I then activate the Monte Carlo option, with no other changes, and run another analysis. The Suggested Consumption Table is noticeably different between these two runs. The Current and Suggested Consumptions are lower by about 10% for the Monte Carlo active run. The Suggested Savings is lower by about 10% as well. I was expecting these to be identical between runs. I am missing something here?


dan royer's picture

No, they will be different because in Econ mode you indicate some assumed nominal rate of return on husband, wife, and regular assets. In MC mode, those rates of return are determined by, in this case, the default asset classes assigned to those three pools of money.

Thanks Dan. That helps. Just for my own edification I'll setup a dummy asset and portfolio that gives me the same numbers as the Economic-Based Planning case. Just want to see what that looks like.