I Simulated My Retirement Plan — Here's What I Found

The Spreadsheet I Kept Ignoring

I had a retirement spreadsheet. I had built it in 2022 with a YouTube tutorial, filled in my salary ($94,000), my 401k contribution rate (8%), my employer match (4%), and a 7% average annual return. The spreadsheet told me I would have $2.1 million at 65.

I did not trust that number, but I did not have a better one. So I kept contributing at 8% and not thinking about it.

Last month, I ran a simulation. The simulation told me I would be $340,000 short of what I actually need. Here is what I found — and what I changed.

The Problem With Retirement Spreadsheets

Spreadsheets compute the future as a linear projection of the present. Your current salary grows at a constant rate. Your contribution rate stays fixed. Your returns average out to a smooth 7% per year. No job changes. No salary plateaus. No market corrections at inconvenient times. No student loan interest eating into investable income during your highest-growth years.

Reality does not work this way. Retirement outcomes are determined by sequences of events, not averages. Two people with identical expected values — same salary, same contribution rate, same average return — can end up with dramatically different outcomes depending on when their salary grows, when a market correction hits, and when they need to reduce contributions temporarily.

A simulation models the sequence. A spreadsheet models the average.

What I Put Into the Simulation

I used PraxiRun's Life Planning domain, which models career progression, investment vehicles, debt payoff schedules, and retirement drawdown as an interconnected system — not a spreadsheet.

My inputs:

• Current salary: $94,000
• Current age: 31
• 401k contribution: 8% (employer matches 4%)
• Student loans: $38,000 at 5.8% — currently on income-based repayment at $310/month
• Roth IRA: Contributing $200/month
• Emergency fund: 3 months of expenses, fully funded
• Expected promotions: L4 → L5 at year 3 (+22% salary), L5 → L6 at year 8 (+18% salary)
• Home purchase: Planning to buy in year 4, estimated down payment $80,000
• Retirement age target: 65
• Annual retirement spending target: $72,000 (in today's dollars)

What the Simulation Showed

The simulation ran 500 scenarios with variable market returns drawn from historical distribution rather than a fixed 7% average. It also modeled the actual sequence of financial events: loan payoff timing, down payment saving, home purchase, salary growth, and how each affects investable income.

Baseline scenario (no changes): $1.76M at 65. My spending target, inflation-adjusted, requires $2.1M. Shortfall: $340,000.

The simulation identified three causes of the shortfall that my spreadsheet had missed:

1. My Student Loan Is Costing Me More Than I Realized

On income-based repayment, my minimum payment is $310/month. But I am making $310/month — I am not paying it down. At 5.8% interest, the loan balance is barely moving. The simulation showed that this loan would still have a $29,000 balance in year 6, two years after I plan to buy a home.

The simulation ran an alternative: aggressive loan payoff now at $1,100/month for 3 years. Total interest paid: $6,200 (versus $18,400 on current path). Freed-up $800/month from year 4 onward. Retirement balance improvement: +$127,000.

2. My Home Purchase Down Payment Comes at the Wrong Time

I am saving $1,200/month toward a home down payment. The simulation flagged that I am saving this in a HYSA at 4.8% while contributing 8% to my 401k and getting a 4% match. The math is correct: employer match gives a guaranteed 50% return on 8% contribution, so I should max that before non-matched savings.

But the simulation also showed that my down payment savings window overlaps exactly with my expected L4 → L5 promotion — the period of maximum salary growth. Delaying home purchase by 18 months and using the salary increase to save aggressively would result in the same down payment with less total sacrifice and more compound growth in the 401k during those 18 months. Retirement balance improvement: +$58,000.

3. My Contribution Rate Has a Post-Promotion Cliff

My 401k contribution is 8%. When I modeled my salary jumping 22% at the L4 → L5 promotion, my take-home pay increases significantly. But my 401k contribution stays at 8% of the higher salary — I had not planned to increase the percentage.

The simulation showed that increasing the contribution rate by 3% immediately after the promotion (the month I stop feeling the salary jump and just normalize to the new income) would capture $720/month in additional tax-advantaged growth during my highest-compounding years. Retirement balance improvement: +$193,000.

The Changes I Made

1. Switched from income-based repayment to aggressive payoff. Added $800/month to student loan. Target: paid off in 26 months.

2. Set a calendar reminder for month 37 (post-promotion): Increase 401k contribution from 8% to 11% that month, before lifestyle inflation sets in.

3. Delayed home purchase target by 18 months — from year 4 to year 5.5. Used the promotion salary increase to build the down payment faster.

Total impact: +$378,000 to projected retirement balance, turning a $340,000 shortfall into a small surplus.

What I Learned About Retirement Planning

The most important thing I learned is that the sequence of financial decisions matters more than the magnitude of any single decision. My spreadsheet told me I was basically on track. The simulation revealed that the order in which I tackle debt payoff, home purchase, and contribution rate changes has a six-figure impact on retirement — not because any individual decision is dramatic, but because of compounding effects over time.

Your retirement plan is not a spreadsheet. It is a system. Simulate it.

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Model your own plan → praxirun.com/demo — Try PraxiRun's life planning simulation free, no signup required. Put in your real numbers and see what the scenarios reveal.