Optimal Finance Daily - Financial Independence and Money Advice 3425: [Part 2] Dealing with Uncertainty in Retirement Calculations by Darrow Kirkpatrick of Can I Retire Yet
Jan 17, 2026
Unpack the unpredictability of retirement planning with insights into how slight shifts in variables like inflation and expenses can reshape your financial future. Explore why retirement models are more like compasses than precise maps. Discover the surprisingly significant impact of investment returns and Social Security on your financial landscape. Flexibility and quality of life take center stage as you learn to adapt and adjust based on real retiree experiences. Embrace uncertainty with strategic choices and resilience for a thriving retirement.
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Small Changes, Huge Retirement Gaps
- Small, realistic shifts in key variables produce dramatic differences in retirement outcomes.
- The gap between best and worst cases can exceed one million dollars by age 95.
Three Drivers Dominate Outcomes
- Investment returns, Social Security, and living expenses account for most of the scenario differences.
- Individuals have little control over returns and Social Security but can partly control expenses.
Extremes Map The Risk Envelope
- Extreme scenarios are unlikely to occur in full, but multiple simultaneous negatives do happen.
- Examining extremes maps the envelope of possibilities and highlights tail risks.