THE MITEY FIELD NOTES
How to read a financial projection
Separate assumptions from forecasts when exploring savings growth, future goals or retirement withdrawals.
The short answer
A projection says what follows mathematically if the entered assumptions hold. It does not say how likely those assumptions are. Read the rate, timing, inflation, tax and cost scope before interpreting the ending balance.
01 / A CLOSER LOOK
Name the money and the timing.
Start with a purpose and a date. A target in future dollars includes whatever future spending amount you enter; a target stated in today’s purchasing power needs a consistent inflation treatment. Mixing a real return with a future inflated target can distort the result.
Contributions at the end of a month compound for one fewer month than contributions made at its beginning. An annual effective rate and a nominal annual rate divided monthly are also different conventions. The tool’s method describes its convention; keep it constant when comparing.
02 / A CLOSER LOOK
Explore sensitivity instead of finding one perfect number.
Try a lower return, higher cost, shorter saving period or larger withdrawal. Hold a baseline, change one input and compare the results. This reveals which assumptions drive the calculation, without assigning probabilities that the model has not estimated.
Constant-return drawdown hides sequence risk: different orders of market gains and losses can produce different outcomes when withdrawals occur. A remaining balance under one smooth path does not establish that a retirement plan will withstand uncertain markets or a longer lifespan.
03 / A CLOSER LOOK
Keep the useful record.
A saved result should include the figures, the page, the period and the exclusions. Our local plans store only when you choose to save in this browser. A share link deliberately includes the figures; a printed result or exported ledger can be retained separately.
For real decisions, reconcile the model with the applicable account rules, costs, taxes and personal circumstances. Do not interpret a default return, example withdrawal or chosen reserve month count as personalized advice. The point of the model is to make the assumptions visible enough to question.
Sources and scope
The source provides context for the subject. The worked models are MITEY implementations described on their own pages. This guide does not assess personal eligibility or recommend a product. Report a correction.