The Road to FIRE - Stress Testing My Plan Against History

There is no guarantee what the future will hold, so when planning for our financial future, we can look back at history and replay our finances in that context and see what would happen. In this post I will answer whether my retirement will survive 111 years of historical data using pessimistic scenarios to achieve a 98% success rate. I am using a tool that I was able to get free access to during my time working in financial services, it allows me to act as a financial coach and plug in one set of client details. It just so happens that client is me. So I’ve plugged in my income, my assets, my planned expenditure from now until retirement and beyond. Historical Risks Captured The data this tool uses has captured 7 major wars, including the two world wars. Hyperinflation - this is where inflation has hit double digits - has hit over a dozen times in the last 111 years, it covers pandemics such as the spanish flu, SARS, Ebola and of course Covid-19 as well as many other world events My…

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