How It Works
- Current portfolio value for selected asset categories
- Expected annual returns for each asset
- Monthly recurring contributions for each asset
- Time horizon calculated from your current age to target age
- Month-by-month compound growth simulation
Key Assumptions
- 1Expected returns remain consistent over the investment timeline
- 2Monthly contributions stay at current levels, unless the optional contribution growth simulation is enabled — then they rise each year by the rate you set
- 3Returns compound monthly without interruption
- 4No major portfolio changes or extraordinary events
- 5Market conditions remain relatively stable
- 6Tax implications are only considered when the tax simulation is enabled
Mathematical Approach
The prediction runs a month-by-month simulation. Each month, for each asset: New Value = Current Value + (Current Value × Monthly Return) + Monthly Contribution Where: Monthly Return = Expected Annual Return / 12 Monthly Contribution = Recurring investment amount With the contribution growth simulation applied, the monthly contribution compounds at your annual growth rate. The simulation runs for (Target Age − Current Age) years to project your future net worth.
Important Limitations
- Market volatility not considered
- Life events and financial changes excluded
- Becomes less accurate over longer time periods
- Contributions only grow when the contribution growth simulation is enabled
Important: This prediction shows potential outcomes under ideal conditions. Actual results may vary significantly due to market conditions, economic changes, and personal circumstances.
Frequently Asked Questions
How do I project my net worth at a future age?
Worth by Age simulates each of your assets month by month from your current age to a target age you choose, compounding each asset at its expected annual return and adding your recurring contributions. The result is your projected net worth at that age.
Can I see the projection in today’s money?
Yes. Enabling the inflation simulation deflates the projected value into today’s purchasing power, and enabling the tax simulation subtracts estimated capital gains tax from the projected growth first.
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The information and calculations provided are for informational and educational purposes only and should not be considered financial, investment, or professional advice. Projections are hypothetical, based on assumptions that may not reflect actual market conditions. Past performance does not guarantee future results, and all investments carry risk of loss. Consult a qualified financial professional before making financial decisions.