Income Lab’s Justin Fitzpatrick and Derek Tharp share research and insights on the accuracy of different Monte Carlo forecasts in retirement income planning.
Learning Objectives:
Understand how forecasting models can over- or under-predict retirement risk and the important effects of these errors on clients.
Evaluate different approaches to capital market assumptions (traditional Monte Carlo, Regime-Based Monte Carlo, Historical simulation, and reduced-return Monte Carlo) and how they effect retirement income advice.
Learn how ongoing adjustments can help counteract forecasting errors as a retirement income plan progresses.
Justin Fitzpatrick is President and Co-Founder of Income Lab, retirement income planning software used by thousands of financial advisors. He developed the guardrails-based approach to retirement income distribution after a decade in financial services at Jackson and seven years in academia at MIT, Harvard, and UCLA. His research on adjustment-based planning has been published on Kitces.com, ThinkAdvisor, AdvisorPerspectives, and FinancialPlanning Magazine.
