What Is Your Chance of Success in Retirement? LFG Daily - March 16, 2026

If you’ve been saving and investing for years, one question eventually comes up: “Am I actually on the right track?”

Many investors have multiple accounts—401(k)s, IRAs, brokerage accounts—but rarely step back to see how everything fits together. That’s why we offer a Free Portfolio Analysis and 1,000-Foot View Financial Plan.

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• Your overall investment allocation• Hidden risks or portfolio overlap• Fees that may be reducing returns• How your investments align with your long-term goals

Think of it as a financial second opinion—a chance to step back and make sure your strategy is built for the future.

If you’d like clarity and confidence about where you stand, schedule your free portfolio analysis today.

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Luke Lloyd, CEO Lloyd Financial Group

Monte Carlo Analysis in Financial Planning: Preparing for the Unknown

One of the biggest challenges in financial planning is uncertainty. Markets fluctuate, inflation rises and falls, tax policies change, and life itself rarely goes exactly according to plan. The question many investors ask isn’t simply “Will my plan work?” — it’s “Will my plan still work if things don’t go perfectly?”

That’s where Monte Carlo analysis becomes one of the most powerful tools in modern financial planning.

What Is Monte Carlo Analysis?

Monte Carlo analysis is a statistical simulation used to test how a financial plan might perform under thousands of different market scenarios.

Instead of assuming a single average return—say 7% per year—the simulation runs thousands of potential market paths that include good markets, bad markets, recessions, and strong bull runs.

Each scenario answers a simple question:

If the future unfolds this way, does your financial plan still succeed?

After running thousands of simulations, the results show the probability that your plan will work over time.

For example:

• 1,000 simulated retirement scenarios

• 820 succeed without running out of money

• 180 fail

  
  

That would give a success probability of 82%.

Why Average Returns Can Be Misleading

Traditional financial planning used to rely heavily on average returns.

For example:

• Portfolio expected return: 7%

• Retirement withdrawal rate: 4%

• Inflation assumption: 2.5%

  
  

On paper, this might look perfect.

But the problem is markets don’t deliver returns in a straight line.

You might get:

• +18% one year

• –12% the next

• +6% the year after

  
  

The sequence of returns matters tremendously—especially in retirement.

This is called Sequence of Returns Risk, and it can dramatically impact whether a retirement portfolio lasts 30 years or runs out early.

Monte Carlo analysis specifically accounts for this risk by randomizing the order of returns in each simulation.

How Monte Carlo Works in a Financial Plan

A financial planner typically inputs several key variables:

• Current savings and investments

• Annual contributions before retirement

• Retirement spending goals

• Expected inflation

• Investment allocation (stocks, bonds, alternatives)

• Retirement age and life expectancy

  
  

The model then runs thousands of simulations based on historical volatility and correlations.

Each simulation represents a potential version of the future.

The results are usually displayed in two ways:

1. Probability of Success

The percentage of simulations where the plan does not run out of money.

Typical planning thresholds:

• 70%–75%: moderate confidence

• 80%–85%: strong confidence

• 90%+: very conservative plan

  
  

2. Wealth Distribution Over Time

Charts showing:

• Median outcome

• Best-case scenarios

• Worst-case scenarios

  
  

This helps clients visualize how wide the range of possible outcomes can be.

Why Monte Carlo Matters for Retirement Planning

Monte Carlo analysis helps answer some of the most important retirement questions:

• Can I retire early?

• How much can I safely spend in retirement?

• How will a market crash affect my plan?

• Should I adjust my portfolio allocation?

• What happens if inflation stays elevated?

  
  

Instead of guessing, the analysis shows how resilient the plan is to shocks.

For example, a Monte Carlo simulation might reveal that:

• Retiring at 65 has a 92% success rate

• Retiring at 62 drops success to 74%

  
  

That information allows clients to make informed decisions before taking unnecessary risks.

Stress Testing Real Life Events

Another advantage of Monte Carlo analysis is the ability to test real-life financial decisions, such as:

• Buying a second home

• Funding a grandchild’s education

• Increasing retirement spending

• Taking Required Minimum Distributions into account

• Adjusting Social Security claiming strategy

  
  

Each change can be modeled instantly to see how it affects long-term probability of success.

The Limitations of Monte Carlo

While Monte Carlo analysis is incredibly valuable, it’s not a crystal ball.

The simulation relies on assumptions about:

• Market volatility

• asset correlations

• inflation

• longevity

  
  

If those assumptions change dramatically, the results will too.

Monte Carlo should therefore be used as a planning framework—not a prediction tool.

The real value comes from helping investors understand risk and flexibility.

The Real Goal: A Flexible Financial Plan

A strong financial plan isn’t built on predicting markets perfectly.

It’s built on resilience.

Monte Carlo analysis helps investors see the range of possible outcomes and adjust their plan accordingly—whether that means saving more, retiring later, spending less, or adjusting their investment allocation.

Because ultimately, financial planning isn’t about predicting the future.

It’s about preparing for it—no matter what it brings.

Don’t leave your financial future up to chance. Let’s build a plan that gives you confidence today and peace of mind for tomorrow. Click here to schedule a meeting — I’m here to help you take the next step toward financial freedom.

Colin Symons, CIO Lloyd Financial Group

The Ides of March is today and considered the date of Julius Caesar’s assassination in 44BCE. Thus, Shakespeare’s line, “Beware the Ides of March.” Along those lines, investors remain quite nervous, fearing trouble from a variety of places. Let’s run through them.

Obviously, Iran has been in the news quite a bit. The fear is that the Strait of Hormuz will be blocked for months, sending oil to $150 or higher, creating a global recession. Quite the fear.

I agree with the legendary (and fellow Pittsburgher) Stanley Druckenmiller, who says “the best economist I know is the inside of the stock market.” With that in mind, let’s look into the market.

The XLE energy sector seems to be potentially forming a double top started on March 1st. Oil itself touched $120 on March 8th and has struggled to touch $100 ever since. Oil volatility (OVX) has been more stubborn but peaked March 11th at 122. The market is a good economist because it tries to price the future. Things can change, of course, but the market appears to have already priced in the worst case and relaxed somewhat.

A previous big fear had been that AI will destroy software companies. That worry has been around for years, really, but hit a climax in late February, with the IGV software index becoming very oversold and touching multi-year support at $75 before rapidly bouncing to $88. That leads to the last concern, private credit, which I think it’s fair to say remains unresolved.

The software/private credit link exists because there are a lot of software loans in the space. If software is getting killed by AI, those loans aren’t getting paid back, right? To be clear, there have been problems in the private credit space for years and you can make a reasonable (if not necessarily true) argument it’s getting worse. The real question is what’s priced in.

In this case, the market is acting like this is a systemic issue, with the whole financial sector (XLF) down -10% on the year. I think it’s going to be very tough for private credit to be a systemic issue, as that implies the assets lent against are permanently impaired. As Bob Elliott of Unlimited Funds says, the whole private credit industry is about $1.3T in size. To be fair, the numbers I find say it’s closer to $3T but the point is that this is tiny compared to the $13T mortgage market that caused the 2008 crisis. Perhaps more important, leverage is far more prominent in the mortgage business, making it much easier to create trouble.

Where could you point to trouble from private credit more specifically? Insurance companies have been in focus (life insurance in particular,) as they own a massive amount of private credit, with Bloomberg saying they own $2T. Unfortunately, there is no dedicated life insurance ETF, but a large life insurer like Prudential (PRU) is down -22% from 52-week highs and -18% YTD.

I think it’s fair to say the market is worried. Do we seem to have fully priced in those fears? Maybe, but that would be a pretty aggressive statement. For example, PRU’s implied volatility (IV) peaked Thursday and for the first time in a while stressed names in the space started getting a bid. One day isn’t exactly a trend, though.

To conclude, I’m willing to claim that of the problems investors are concerned about, the market says oil and software are likely contained. That can change, of course, but the market is saying focusing on those two worries may be a mistake. Private credit is still a top-of-mind concern, but there are early signs we may be done worrying about that, as well.

One last thing to mention. One reason I’m so focused on trying to pick the bottom here is that there’s so little upside expectation. The market is heavily hedged for trouble, which is why even with the last two days of poor market movement, volatility can’t get a bid. That doesn’t mean the market can’t go down, and I’ll repeat what I said last week that this is a dangerous environment, but if problems resolve and we get an upside bid, it could be very powerful. I think that’s something we can see in the next week or two and there’s very little focus on it. As always, we’ll take our odds and see what happens.

The latest Q4 GDP revision cut growth to 0.7%, from an already tepid 1.4%. Government spending shrunk with the shutdown but everything was relatively weak, really.

Personal Income was 0.4% m/m vs. exp. 0.5%, while Personal Spending was 0.4% vs. exp. 0.3%. Overall, spending growth has been outpacing income growth on a Y/Y basis.

JOLTS job openings were higher than expected, at 6.946MM vs. est. 6.75MM. That’s a strike against the weak jobs narrative.

An Indian ship sailed the Strait of Hormuz with Iranian permission.

China and the US restart trade talks, this week.

Investors sold a record amount of SPX futures last week, according to the COT report.

META is planning sweeping layoffs effecting 20% or more of the economy as they seek to offset AI costs.

Industrial Production and Empire State Manufacturing, today.

What does it all mean? Oil is down a bit and stocks are improving as the Middle East seems a bit less bleak.

Don’t leave your financial future up to chance. Let’s build a plan that gives you confidence today and peace of mind for tomorrow. Click here to schedule a meeting — I’m here to help you take the next step toward financial freedom.

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