Simulation

After a period of deprivation and frugality, Luise has entered a phase of greater financial freedom. All her funds are in an ETF portfolio that averages a 7% return in the long term. Unfortunately, the 7% return is not constant and fluctuates significantly. Luise plans to withdraw a certain amount every month, either through dividends or by selling shares. Before I continue with a financial-themed story, I want to clarify that I’m not a financial expert. I’m just an individual who is interested in personal retirement planning and other financial topics, accumulating some solid half-knowledge along the way, and occasionally relying on my more or less sound common sense. From time to time I create or extend a calculator. ...

When calculating financial goals, it’s often assumed, like on the informative website Finanzfluss, that there’s a fixed annual return. In the suggested return range of around 5% to 7% per year, I dare to challenge the expectation of consistent returns without the fluctuations of stock investments. Therefore, I’ve briefly explored simulating stock prices and implemented a savings plan calculator based on this concept. The focus of this article is on the simulation aspect. However, please note that I haven’t consulted any books or experts – I’m just here for fun. ...