I had trouble finding a good FI planning and simulation tool that could model things in enough detail to finally ditch my spreadsheets... so I decided to build one: ProjectiFi
A while back I posted a very early version here (https://news.ycombinator.com/item?id=26969173), and just released a major overhaul with loads of new features and enhancements, many inspired by the initial HN commentary:
- Monte Carlo mode with customizable simulations, variables, probability distributions
- Backtesting on historical data
- Multiple data persistence options for subscribers: cloud synchronization, localStorage only, or manual import/export
- Stock/bond allocation curve over time
- Improved support for international use cases (currency + locale selector, custom options and contribution limits for financial goals)
- Ability to quickly switch between deterministic and probabilistic modes
- Many new event types to model a broader range of scenarios
- Better support for married filing jointly / couples planning (perhaps still not perfect, but definitely better)
If you feel like checking it out, I would love to hear what you think. Most of the functionality is free, but for anyone interested in upgrading to Premium, you can use coupon code "HN-15" for 15% off all plans :)
I actually have a draft open in gmail that i was meaning to send to you, so ill post it here instead :)
I saw your initial release of this many months ago, tried it out, was like, ok thats kinda cool, put it down.
But then recently i needed to do some serious life financial planning, remembered your tool, searched for the HN post and gave it a real go.... and WOW. Im so impressed. It does exactly what i need; give me a semi-realistic long term plan of finances, retirement, how much house i can afford, effect of jobs, stocks, etc. Being able to play around with scenarios like "what if one of us didnt work for a few years?" really easily. I probably could do all this stuff on a spreadsheet, but the fiddly details of things like inflation, raises, tax, etc are incredibly tedious to model. theres a lot of near term budgeting type apps etc out there, but there was no other product i found that works so well for long term macro stuff. So its well worth the premium subscription fee to me, on a time saved basis alone.
The UI/X is mostly great(ill email you some minor suggestions :) ), and your development velocity is really impressive.
Perhaps the total market for a tool like this is niche, but hopefully it turns into a profitable enough endeavor for you so you can keep working on it forever :)
Thanks! It started out as something I knew I wanted for my own planning purposes, as well as friends and family, and it's awesome to hear that it's a tool you too can imagine coming back to when you consider new life plans and decisions. I aim to keep evolving it over time, and I'll be happy to take a look at those UI/UX suggestions you have.
- it was really un-intuitive to me to edit my starting investments/position. The little cal icon top of the left sidebar was not where i was looking for that. Suggestion: add starting conditions it as a collapsed column furthest to the left in the stacks under the main graphs. thats where i expected it to be, along side the other personal detail stacks
- adding a house mortgage and having it default to trying to pay it off as fast as possible seems wrong, few people would do that, makes more sense at low interest rates to do the regular 30yr
- its easy to accidentally do something that doesnt make sense that has big consequences... eg i was playing around quite awhile before i realized i had my living expenses marked as $X,000 per year instead of per month. I wonder if you could come up with a nice way to warn people when things are significantly outside "normal". eg "hey looks like your living expenses of $200/mo are unrealistic, did you mean this? y/n" dismissable, but might help people into correcting the bigger mistakes
Thanks for the ideas! I've been feeling like the initial conditions concept could use some work, and this approach sounds promising -- seems like it could also facilitate playing around with different initial conditions in different plans (if desired) as well.
I think warnings like you mention would be a great addition as well, though I have an intuition it may be difficult to pin down what outside of normal really is, since things can be different around the world. Still, I bet it's possible to call attention to any truly ridiculous-seeming values.
I'm super interested in this, but, every time I try this you end up losing me in the funnel. It takes too long to set everything up and I eventually lose interest and exit.
Do you think it would help if I make a "sandbox mode" where you can skip onboarding and plan creation and jump straight into a scenario pre-configured to model one of several selectable templates / personas? That's something I've been debating about building for a while but haven't had a chance yet.
It's true though, making a detailed plan requires detailed inputs. Are there any specific areas in the funnel that you would recommend cutting out or altering?
- when asked rent and house expenses as a percentage, is it a percentage of initial cost? current value? future value? It doesn't really make sense as a percentage. I don't charge a tenant X% of my cost, I charge market rate which may be more, or less than my actual expenses.
- same for taxes. it's a nearly fixed amount that increases over time, but trying to do it as a % calculation of actual dollars is often incorrect because that's not how it's calculated in real life.
I tried it, filled up all the data and the end screen with a "plan" stopped 1 year after my current age with chart lines looking kind of botched. I think some calculations may be wrong or something.
Hmm, this sounds like the kind of thing that could happen if you have a huge percentage value in an expense or tax input by mistake, or something along those lines that could create an immediate bankruptcy scenario. If you double-check everything though and think there is a more sinister issue at play, I'd be happy to look into it and/or help troubleshoot.
JFYI, maybe it is just me, but in Assets ->House you have:
Effective yearly tax rate
Yearly maintenance costs
Yearly insurance rate
I automatically visualize "rate" as a percentage but I see "costs" as being expressed in actual money, so I inserted (believed to be inserting) 2,000 Euro in maintenance costs which of course ended up being 2,000% of the asset value.
Quickest bankrupt ever!
Maybe Yearly Maintenance Rate would be less prone to possible errors?
Ah good call. I see how that can be confusing. Hopefully I'll also be able to add in a system where you can toggle some of these inputs between percent and fixed value as well.
Your simulator seems to work "by category", i.e. it takes expenses for the house (taxes, maintenance, insurance) from the value of the asset?
I.e. with constant income fixed 6000 (salary until retirement and same amount as pension, tax exempt, todays money, follow inflation), no living expenses, and only a house with value fixed to 200000 (but adjusted to inflation), 1% tax, 1% maintenance, 1% insurance, the value of the asset decreases.
That should be 6000 income tax exempt, 6000 expenses, same house, everything fixed but adjusted to inflation.
But it is not like you are going to pay taxes, maintenance or insurance with "slices" of your house.
Anyway, with those values I start at 25 Net Worth 200,000 (only the house) and end up at 92 with a house worth 26000 and a lot of cash, 121000.
Hmmm, if you open up the "House" asset form and look at the "Value Change Over Time" field within the During Ownership section is it definitely set to "Match Inflation"? I just tried to replicate your scenario, and in mine the house maintains the 200k value throughout the simulation.
Of course not, it isn't but it seems like it is (to me at least).
In the Wizard:
House 200000 200000 paid off
Acknowledge, etc. Confirm
Create a Plan
etc.
Now I have Other Asset value 200,000, Already Owned, cancels out Rent expenses during ownership, Value is fixed only adjusted for inflation, never sold
etc.
House starts at age 25 200,000, arrives at age 92 at 25,986.
25 first year is 200,000
26 second year is 194,000
27 third year is 188,180
The asset is defined "Fixed value only adjusted for inflation".
Of course if I enter the asset and change from "none" (that is now explained as "Inflation of 3% will decrease asset value over time") to "Match inflation" (that is explained as "Asset value will increase over time matching the inflation rate of 3%" and comes out on the main plan as "Value increases to match inflation" I get the "flat graph" I expected.
The issue is about the wording:
"Fixed value only adjusted for inflation"
vs:
"Value increases to match inflation"
The (fixed) value of an asset cannot "increase to match" (it is fixed) it can only be "adjusted to match".
As I see it the first one is "Fixed not adjusted to anything" and the second is "Fixed but adjusted to match inflation". (and something like these will disambiguate from Appreciate/Depreciate).
BTW the actual Appreciate/Depreciate % needs to be increased/decreased of inflation rate.
As I see it, there should be three possibilities only:
Fixed
Appreciate (and its %)
Depreciate (and its %)
and then a separate checkbox for "Match Inflation".
As an example, if you have Inflation at 3% and select Appreciate 1%, the result is a declining value (as you have no way to Appreciate it 1% AND match inflation, while it is common - at least here - to consider appreciation rate not as absolute but the difference over inflation, it should be specified/explained that there you need to put an absolute rate including inflation).
I had roughly the same experience but it was 10 years instead of 1. I just took the defaults for tax rates and stuff because frankly it already felt enough like doing my taxes just to get an idea of how the thing worked.
When you say it stopped, did it show a bankruptcy condition for you or more like a weird unexplained simulation stoppage? If the latter, I'll look into it right away, and if you can identify any simple reproduction steps that would be very helpful.
It seems that this is a difficult problem to solve. These kinds of tools don't provide a lot of value unless they have a significant portion of your financial picture. Providing that picture takes a lot of manual data entry. I suppose it could ask more generic questions first (e.g., "enter total cash," "enter total investments," etc.) but that wouldn't be very accurate.
I'd say the premium / monetization aspect is something I'm still open to suggestions on. I knew I wanted most functionality to be free, so that everyone could use the tool to develop insights about their potential life trajectory and trade-offs between different decisions, and I didn't want anyone to feel priced out of that experience. Likewise, I didn't want to bombard people with ads, and would never want to collect and sell data or anything like that. Currently, even more advanced features like monte carlo mode are available for free... I felt all this left me with few remaining monetization options, so I'm currently trying the model where data persistence (bringing more convenient repeat use) is one of the premium features. If you keep the tab open and then eventually upgrade, your data will stay.. but currently it will disappear if you close the app without a subscription.
There's also some uncertainty around persistence of data if I start a paid plan (or trial) but do not continue.
Does the data I'd entered thus far get purged, and I would have to re-enter it if I picked the plan back up?
I feel like this kind of tool might be something I'd update once a quarter or once a year, but not want to pay for every month. But if my data is deleted in between uses, it's also a lot less useful. Is there a rational middle ground?
If you go to cancel a subscription, there should be a modal that pops up warning that persisted data will be removed if you continue to cancel.
And yeah I see your point on wanting to come back and update things periodically. Is this perhaps where the yearly / lifetime plan options make more sense? Or are those priced too steeply in your estimation?
> If you go to cancel a subscription, there should be a modal that pops up warning that persisted data will be removed if you continue to cancel.
There's no way to know that before choosing a paid plan though, is there?
I'm not a good person to ask - I avoid spending money (I think) much more so than most people. And I wrote my own software for tracking all my finances (with zero graphs.) So I'm hesitant to spend money on other software.
Depending on a person's weakness or uncertainty, this kind of software can fill in a lot of gaps and help them make decisions that can dwarf the cost of your software, so I doubt the pricing is prohibitive.
As always, take me picking apart your software as a token of interest and a compliment. (I really wish I'd start picking up graphs from my back log...!)
> There's no way to know that before choosing a paid plan though, is there?
On the home page in the "How it Works" section, there's a screenshot showing how you can remove your data. Perhaps I should make that even more prominent though, since evidently not everyone notices.
One possible suggestion is a one-time payment option. In a couple of my projects I have daily/weekly/monthly plans that allow people to pay up, use the features and then go away without worrying about long-term financial consequences. Maybe an option were someone can pay up, export their data and then whenever they want to import it back in they sign up for another short plan.
Maybe persist for the free plan but only for a month. That should give me enough time to decide if I want to convert.
I feel like a lot of products with subscription plans want to convert too quickly. I have a full time job and family. Life gets in the way of being able to dedicate full attention to getting something setup.
This is really good & helpful! Wish I had this thing years ago when I was doing pro-bono financial planning for family members. Would have been much easier than building spreadsheets for them...
Couple of points of feedback:
1. The UI flow for adding financial goals (like putting excess earnings into taxable investments, rain day funds, etc.) didn't make it immediately clear what that section was for. Some clearer explanations in that section might improve your funnel.
2. The way that debt is displayed by default on the stacked chart sort of makes it look like an asset, which is confusing. My reaction was just not to trust the chart for the whole duration of having a mortgage. Changing the house asset value in the stacked chart to home equity instead could maybe be a fix?
3. I really liked the little red exclamation indicator when a plan involved you running out of money b/c you retired too early. It felt very well calibrated to clearly indicate the inadvisability of that particular plan w/o being overwrought.
You might want to add less alarming yellow indicators to pick up not great, but not terrible situations like you retired too early & all your assets are tied up in retirement accounts and illiquid assists (e.g., home equity), so now you are eating early withdrawal penalties unnecessarily.
For #1, I agree that section can be a bit difficult for new users to grasp. It's laid out the way it is so that later you can simply click and drag to re-prioritize goals and see the effects, but I'll think about how to communicate the purpose of that section better from the beginning.
For #2, yeah the concept of showing debt on top of everything else may be a bit... unconventional haha. That's where switching the plot to the net worth one can help somewhat if you want the chart to clearly show total net worth. In the stacked view, changing house value to equity is an interesting thought, though I think that still leaves it an open question how the chart should account for the other kinds of debt one might have.
For #3, yes definitely. Identifying warning scenarios and clearly marking those is a good feature idea.
It would be easier for me if I could start with a template. Having a few buttons for representative simulations like "married high income" and "single FIRE" that you could then adjust to your scenario instead of starting from scratch would be nice.
Agreed. I've been thinking about making a "sandbox" mode like this where you can jump right in based on a template. Since there have been multiple others asking for something like this, I'll boost the priority.
Looks great! I like that there is a FREE tier - thank you!
I recently wanted to run some simple simulations (mortgage & investments) so I wrote a simple JS script that outputs the amortization table and a graph in the terminal of multiple scenarios you want to compare. Very limited in scope, but might be useful to others:
This is fantastic, and the pricing for "lifetime" is nearly a no brainer.
Here are some additional ideas for ways to generate revenue:
* $100-$200 one time guided setup consulting, where someone spends 30-minutes with me on zoom to get data setup the right way, talk through data analysis process, talk through simulation and projections, etc.
* Marketplace to connect me with financial advisors who know your software, align with your approach to financial planning, and can help me with next level optimization.
I'm not a financial advisor, but if it's ProjectiFi itself that you're looking for help understanding, I could certainly walk you through it. Feel free to shoot me an email if you'd like to discuss further.
I gave a quick try and just from the first look this looks amazing. It's precisely what I'm missing in my spreadsheets for my personal finance: probabilistic planning. I'd consider paying the premium tier but I miss a few things:
- Support for tax brackets in other countries (maybe let users introduce them manually)
- Support for "disasters" in the probabilistic case. I'd be interested in knowing how robust is my strategy to being fired, or having a reduced salary. For example, letting me input a "probability of losing employment" per year and possible ranges for time being unemployed would be interesting.
- Also, support for variable-rate mortgages would be interesting. Here in Spain there are quite a lot of offers on mortgages at X% + euribor, and it'd be interesting to put together the behaviour of the mortgage index and the investments. Related with the previous points, simulation of economic crisis could be interesting: investments go down, increased probability of losing my job, increased mortgage payments maybe... Do I survive those crisis? What's my margin?
All in all, pretty interesting, congratulations on the job.
Thanks for the thoughtful feedback. It's great to see that you tested out the probabilistic planning mode enough to identify ideas like this that would further enhance it. In fact, some of these things like being able to inject "simulated recessions" are already in my feature backlog, kind of waiting to see how much demand there might be. I'm definitely looking to keep evolving the tool over time, and I'll put some thought into how to accommodate custom tax brackets (seems pretty doable), as well as the other probabilistic features you mention.
Along the vein of supporting "disasters" one of the most interesting useful features when seeing a financial planner for our family was looking at possible effects of death and disability.
I haven't gotten very far in to it so I haven't been able to explore the life events very much. But looking at the long term impact of "what if I died/what if I had life insurance (and what term)" is very helpful to explore.
Localization could be important too, for broader adoption - not just for currency display but (most importantly) the kinds of investments available and tax rates vary a lot. A minor thing is that the 'default' values for % return and inflation are also different in different places
Good point. In addition to customizable income tax brackets, another idea I've been mulling over is a custom investment type with more controls to model a wider variety of investment vehicles. Perhaps I could add more templates as well, and show/hide some based on the localization settings.
Yes custom investment types! Up in Canada I have access to a registered retirement fund (tax-deferred, like a 401k but not as closely tied to employer) and a tax-free savings account (for untaxed growth), and I couldn’t figure out how to model monthly contributions to both out of a single salary stream.
Being able to fund both (and then in retirement, set a max annual withdrawal from the tax-deferred account before withdrawing from the tax-free) is to me an important bit of modelling that I couldn’t figure out how to get sorted in 15-20 minutes.
Wow, amazing how well you integrated the feedback from the last time this was posted, especially architecture level stuff like storing everything client-side by default. The stock/bond allocation curve is really well done too.
Awesome stuff, I just signed up for premium. I assume for people that are not single you're meant to add their expected income and expenses as well? That could maybe more clear
Thanks so much! And yeah I took a lot of that feedback to heart, and have been working hard to make improvements in many aspects and communicate more clearly about things like data storage and where calculations happen (i.e. client side). For couples, things like age values are from the perspective of the person creating the plan, and yeah the idea is to just add in their income, expenses, goals, etc. Switching status to Married in the tax section should auto-adjust contribution limits for US investment types, but custom limits can be set on most things as well. Couples planning is still not perfect overall, but is at least better than how it was before. And if you have more ideas on how it could be improved on from here, just let me know!
Thought:
While I appreciate the stuff around child dependents, it feels very weird and tacked on.
Sure sticking an expense called “child” works if you don’t already have kids, but if you do, those costs are inextricably integrated with your existing lifestyle costs. I can’t easily estimate how much my grocery budget will go down if I remove the food my kids eat. Even if I could, I’m certainly didn’t think about removing my kids from the expense calculations at step 1, when dependents get added later, because I didn’t think it would ask me that.
A better solution would be something that discounted expenses after some date. Similarly, you could always bump up the expenses at some date if you don’t already have kids.
Bug:
I think the net worth chart is a bit busted. Mine started at 0, but that wasn’t obviously wasn’t true. While the growth line looked reasonable, I think the chart needs to be pushed up by an offset.
Thanks Jonathan. Appreciate the callout about the chart -- I'll look into that.
For dependents, wouldn't "discount expenses after some date" be roughly the same as taking some from your current living expenses and putting it into a child expense which eventually goes away?
But yeah, point taken. It's probably not the smoothest experience. Perhaps having additional ways to control how expenses change over time would help? Maybe something along the lines of an interactable plot where you can specify different values at different ages to interpolate between?
May I also add that I really appreciate your plain english privacy summary. The first thing that I think about when using a tool like this how my data can be used without my permission for various nefarious purposes. I do appreciate your effort to leave things client side and to save/load data from the client as well.
Sure thing! From the beginning I set out to be as respectful as possible of people's data, but I gathered from the last HN post that I needed to improve some of the communication on that. Hopefully the summary helps, as well as some of the new data storage options for subscribers.
Thanks! Appreciate the subscription, and I'm stoked you're enjoying the app. I imagine there are others in the FI community that might also get a lot out of it, but I'm not quite sure what the best way is to spread the word. Most subreddits don't allow self-promotion, and same with the Bogleheads forums and wiki. If you or others have any ideas, definitely let me know. Pretty much all my time has gone into trying to make the actual tool, so I haven't done much at all in terms of marketing.
This is very slick and well executed. I especially appreciate the thought that went into data transfer (making it opt in, otherwise stays client side). I have a CFA and have been in finance for a while and have maintained a spreadsheet but honestly this does it better so I will use and support you. I wish more people would take a long view with their financial wellness, maybe I can convince a few friends to see the impact of their debt binges :)
On the UI side there are a few odd things like trying to paste a number that has decimal points makes it so nothing gets pasted in, the colors on some of the graphs are hard to read (especially for people with color vision deficiencies), etc. As I use it I will try to give more specific feedback. Can't wait to dig in further.
Much appreciated! And yeah before building this, I was surprised there weren't already more tools that can show you a nuanced view of what the future may hold and the ways various decisions affect that picture... and the complexity of the spreadsheet I had been playing around with eventually became untenable haha. Thanks for the UI feedback so far, and since you've been in finance for a while I'll be very curious to hear more of your thoughts as you dig further into the app.
I remember your site from the earlier thread, and the experience is so much smoother now. I'm definitely going to start sharing it out since it seems like a very usable tool. I like how you broke out the different types of investments because a lot of other tools tend to have awkward configurations.
The only other feedback I have is for the pricing screens to upgrade if you could list the payment options paypal, etc to manage subscriptions. I've been burned a couple times when smaller creators self manage subscriptions, and I had to email and wait for them to manually adjust the subscription.
Thanks! Really glad to hear you enjoy the improvements. I spent a lot of time thinking about the data modeling and visualization aspects, so I'm happy you find the configuration here less awkward.
This is something that I would be interested in, but you are asking for too much without giving anything back. You are essentially asking me to put my entire budget as well as future plans into your site before giving me anything interesting.
I am estimating it would take > 15 minutes to fill out everything you want, and there is no way I am making that investment into a random website without some token of return.
Please consider giving general projections after only a few questions and then allowing the user to refine it by adding more details if they are interested.
One idea that might help with onboarding for users who want to jump right in is a sandbox mode where you can skip onboarding and plan creation and go directly into a scenario pre-configured to model one of several selectable templates or personas. How would you feel about that?
I logged in to post this exact suggestion. A couple of templates like [married home owners] and [single renter] that would jumpstart the process would be nice.
This is great, as somebody that's inexperience and uninterested in financial planning (but aware I can't ignore it), I really appreciate the simplicity and clear language.
I misread what you were saying in other comments about a sandbox and thought "nah, what this really needs is prefilled scenarios". Looks like you have the right idea: I'd absolutely love that, I have no idea what to fill in most of these boxes and would like some examples! That could orient your tool towards education rather than planning though
Wow, if I had known just how popular a feature this would be I would have done it already! It's going to the top of the list now. And yeah I think the planning process does have an educational element to it, and the way you can quickly experiment with different ideas can help to discover and quantify trade-offs. I'm sure the prefilled template/scenario options would enhance that educational aspect further.
Very nice! One thing would be great to add - cash reserve. I.e. there's a goal to maximize loan payoffs, but I don't want to spend 100% of my cash for that. I want to keep cash reserve (usually recommended is 3 or 6 months of living expenses) - and the rest could be spent on debt payoffs.
I think there might be something wrong with the mortgage calculation? I have a 190k loan with 1.8% per year interest, and paying off around 10k a year. I expect to be debt-free in about 30 years.
But your (really cool btw.) tool tells me I'm debt-free in 3-4 years? Not sure how it comes to this conclusion. Maybe I did something wrong.
The cookies popup seems opt out rather than opt in, unless I missed something. I felt annoyed when I visited all the tabs and withdrew permissions that I never gave.
Ah, I see what you mean. The way it works now, if you ignore the banner, things are disabled by default (e.g. Google Analytics). If you click settings from the banner, the switches default to on at that point (and you can toggle them off), but GA doesn't activate unless you confirm that dialog with them on. Does that make sense? Or do you feel it should be implemented differently? I'm definitely open to changing it.
I'd love to see more sites skip out of GA entirely. If you use server logs for analytics you get better fidelity[1]. You can probably eliminate the cookie consent banner if you're only storing login or session-continuity (required for functionality) cookies.
> If you click settings from the banner, the switches default to on at that point
This is annoying; also, not allowed under GDPR. Cookie and privacy consent should be opt in instead of opt out. Clicking “settings” should not be treated as opting in.
This is really pretty but I personally appreciate the onboarding speed of cfiresim.com much more. Way easier to save multiple models and I can actually understand what the graph is telling me a little easier. I'll be honest, if I'd never seen one of these graphs before I doubt I'd understand the mobile version of yours. No idea what the different colors mean or what all the icons refer to.
I'd be interested to hear what you think of the experience on desktop -- it's definitely better there than on mobile. But point taken; I'd like to keep making improvements for mobile as well.
Looks like a direct alternative to Personal Capital, which I appreciate. Beyond a certain net worth, they continually reach out to you, which is annoying.
Love the net worth back testing screenshot on the front page, but wonder how reasonable it is.
Index funds weren’t available to the general public before the 70s IIRC, and investing fees were very different then.
That's a good point regarding historical data, index fund availability, and investing fees. I suppose the current Monte Carlo mode is closer to saying "what might happen in the future assuming index funds remain accessible and given similar overall returns, dividends, inflation, etc., to what was seen historically (but perhaps without some of the other context like you mention)". When you think about what you would want from a probabilistic planning tool, which are the insights you care most about, and are there changes you would recommend to the current methodology? Or perhaps additional variables?
No, I’m sure the historical-theoretical view is good enough. Unfortunately it will always suffer from that lack of context wherever it’s implemented, and so I’m not sure you can do anything besides point out to people what the conditions were at that time.
That would be my recommendation. Too much financial software out there doesn’t provide historical context and simply parrots useless quips like “Past performance is no guarantee of future results” (which in finance, it actually is a decent indicator!).
Because whole periods of financial history occurred in blocks of time, I’d like to see some financial software that actually acknowledges that.
I’m less interested in novice implementations which simply provide a graph over time of the Dow/S&P 500 performance benchmark, when realistically people didn’t use the S&P until recent history, and VTSAX’s first generation, precursor to the Vanguard 500 Fund, the First Index Investment Trust wasn’t available to the public until after ‘75.
Today, it’s the largest mutual fund in the world, according to Investopedia.
I wonder what major changes and developments we might be likely to see within our lifetimes... do you have any intuitions there? If so, I wonder if there might be additional variables or situation types/probabilities that could be interesting to throw into a monte carlo simulation.
1: One of John Bogle’s concerns was that the funds were becoming so large, they would cause some systemic issues in the long run, because there are limitations to how much funds can own of these companies. This is something you can easily Google and read about on your own time, and it will produce a better response than I can regurgitate here.
But basically, in our lifetime, there will be some sort of reorganization of these funds so that they can continue to grow, I expect.
This will presumably either happen in legislation, or funds being split across some entities at some level.
My guess is, think VTSAX Fund I, and VTSAX Fund II. New clients being moved into Fund II, and Fund I being closed to new investors.
Also, just… more people invest. Period. It’s very different from the investing rages of the past. This sort of volume today is known to remove pricing at large from the stock market.
That is, Tom, Dick, and Harry are going to continue to buy into the stock market by their 401(k) contribution no matter what the price is which is staggeringly dangerous.
Because of this volume and the US still being the preeminent nation on earth to invest in (no Chinese risk, no Indian maximum retail pricing), securities may continue to be overpriced well into the near future.
I would simulate those market details by reducing potential future returns, which is current conventional knowledge. Less than 5% is frequently discussed and is certainly a safe, and even generous, as a maximum threshold for the next decade.
During the initial COVID-19 pandemic lockdowns, the crash then did nothing to bring securities back down to fair market values, so many people just didn’t buy.
If you did, you would have made out great by now, but if you did then, it wasn’t because of the price of stocks. Some people just “bought the dip” without realizing it wasn’t a dip.
A full bushel of Apples today is not worth $250.00. But if that’s all you saw for the last half-decade, and it fell to $200.00, you’d think it was a great deal until you realized the replacement value of Apple trees would generate Apples at lower prices if you just planted them now yourself.
2: I might also play around with crash and correction frequencies if you’re not already doing so, which, without thinking deeper about credit cycles, should be fine to simulate based on previously occurring frequencies.
It seems like you already have some sort of analog to this with historical performance to begin with, though.
This is really neat! We've been hacking on a version of this at Compound http://withcompound.com/ , built specifically for folks who have illiquid assets like startup equity. Similar tools that help you model out your finances/taxes.
This is super useful but the results were screwed up for me because of the default house maintenance estimate. For HCOL areas, 2.5% in yearly maintenance is HUGE.
I'm planning on buying a $2M house in the SF Bay Area and didn't realize this tool was allocating $50K a year just for upkeep. Just a point of feedback :)
Ouch, that's a lot of yearly maintenance. Would you recommend changing the default value or trying to make it dynamic/contextual in some way? Or perhaps just trying to draw the user's attention to it better?
My first inclination would be to base maintenance cost off cost of rebuilding (optionally overridable) -- in effect, you end up with a much lower percent of total value where you're basically paying for an expensive lot, and a much higher percent of total value in depressed markets (e.g. where you can get 100-year-old 7-bedroom for ~= national median home value).
Just guessing here, would it make more sense to base yearly maintenance on $/sq ft instead of overall property value? Would better take in to account expensive but modest (lower maintenance cost) versus huge home (higher maintenance cost).
$/sqft glosses over local labor costs, level of finish, landscaping, etc., which is why you see people suggesting 1-2% of value per year, though you're right that it would be an improvement to separate out the value of labor/materials from the value of a the bare lot.
Yes but looking at Zillow that $2M Bay Area home would go for $250K in Houston TX. In fact, I can't even find homes small enough in Texas to compare some of the houses I see for sale in the Bay...
Do you live in Houston? Yes you can get a home for that in the far flung suburbs, but nowhere near the core city with the cool restaurants and museums Houston is known for. Inside the loop, if you can find houses for ~$300k those are BAD neighborhoods. You need $400k-500k just to leave active active gang violence areas. To be in good neighborhoods you need high 6 figures.
And to your second statement, there are plenty of <1000sqft homes, I'm Austin and in my zipcode they start at $600k.
Much better but not cheap. Houston's median home price is $295 Austin's in $550.
Thanks! I understand that is not your purpose now, but do you plan to extending to businesses? I'd be glad to have such decision helping tool :).
Also, congrats for your website. I find it very clear to understand what the tool does, why it is useful (your example are simple and to the point), and what is your pricing. :+1:
Extending the tool to accommodate planning for businesses sounds like an interesting prospect, though I'll be the first to admit I know less about the nuances there than in the personal finance domain. I'll take a note to do some more research in this direction, and if you have any further thoughts/suggestions on what kind of new features would be needed to accommodate use cases like that, I'd be all ears!
Hey OP, really nice tool! I've been looking for something like this for quite some time now. As some other people suggested, I think it would be nice to be able to add custom investment types for different countries other than US.
Thanks! Are there some specific investment types you'd like to see? And/or perhaps a more general custom investment type with lots of configurable rules/controls? I'd also be curious what your thoughts are on how most things right now are bucketized into cash, taxable, tax-free growth, and tax-deferred. Would it be better to have users configure specific accounts and simulate everything separately at the account level? (trade-off there might be onboarding complexity)
Confused by the assets. It's starting with my current home's value, and decreasing it over time, maybe at the rate that it decreases the debt associated with the asset? But that payment should only be applied to the debt, not the value of the asset.
If you're puzzled by asset value appearing to decrease over time, it's possible this is because values are shown in Today's Dollars, i.e. values are adjusted to account for inflation. If you set the asset to appreciate in value at a higher rate than inflation, you should see the value go up over time.
This was a little confusing to me too - I put in an estimate of salary increasing 2%/year and it showed my gross salary decreasing in dollars each year. That's apparently because the salary increase was in nominal terms and the gross salary was in real terms. Maybe make this clearer - anyone who wants this level of control and detail should know the difference between nominal and real.
Yeah I go back and forth on what the default should be with regard to adjusting values for inflation. I have seen other planners do it this way, and perhaps one of the reasons why is so that you don't look at a high projected portfolio value 40 or 60 years down the road and think you're doing amazing, when in reality those values have much less purchasing power than they would today.
I agree with the choice of presenting in today's dollars by default is more helpful when actually planning. In the deterministic planning it has the note at the top for "All Values in Today's Currency" but I don't see that in the Advanced Simulation and I think it would be helpful to have that reminder on all of the projection graphs so you don't forget what money you are looking at.
Very well done. Clear UI. Simple to use and it delivers a good overview.
The one thing I would suggest ( I assume this would be a part where you attempt to monetize it ) is a referral to financial advisors, who can use the information to assist.
Thanks! Interesting thought, though I have a natural hesitance towards recommending advisors (who might steer towards active management) or investment products, since my initial vision was to try to make the tool as unbiased and objective as possible, and more in keeping with some of the principles from the Bogleheads community. You may have a point though; I would be interested to hear where others stand on this.
There is a lot of skepticism around financial advisors and rightful so given the track record of many (picking insanely expensive funds, charging high fees themselves, etc.)
However, I do think there is a place for advisors not to pick investments but rather actually plan for life events (including tax stuff), which is right up the alley of this app). Having someone who could take all of your inputs, ask the right followup questions and appropriately model the likely range of outcomes on this kind of app could be quite attractive.
True, planning for life and tax stuff does seem like a more distinctly helpful service. I have no connections in the financial advisory space, but in general I'd be open to discussing this kind of idea further.
I do due to the nature of my work, but I do not feel as comfortable recommending anyone specific.
Instead, I would suggest starting by focusing on fiduciary financial advisors ( https://money.usnews.com/investing/investing-101/articles/wh... ), who have a legal duty to not recommend things that do not benefit their client. That alone may help with removing some of the unease of the referral.
Just created a HN account to say how great this looks. Ive signed up and wont be surprised if I grab the paid tier. This is exactly the kind of tool I can get a lot out of! nice work.
There are a lot of buttons without labels, please consider adding alt/title/aria attributes at the minimum. The simulation page is a sea of unlabeled buttons.
Just clicked to try -- found the display currency I wanted, British Pound Sterling between Egyptian Birr and Georgian Lari. Was expecting it to be amongst the other 'B's.
Congrats. Remember trying this out on your previous post and it wasn't that UK friendly, sounds like that should be better minus the Tax features so will try again.
Thanks, I'll be interested to hear what you think of the new version. And if you have further ideas/suggestions to continue improving/generalizing things for international use cases, just let me know!
Thanks! In this case I guess you could say I started out with a design idea in mind first. I wanted a tool that could model my whole life in a single view and re-render changes immediately to encourage quick experimentation. I had an approximate vision in my head for how this would look from the beginning, and once I had a decent MVP together, I spent a lot of time user testing with friends and iterating on various design elements (and the onboarding flow) until most new people found it pretty intuitive.
Not yet, but based on all the commentary here I'll definitely be adding a sandbox mode where you can jump into a pre-configured scenario based on templates like that.
That's where the financial goals section comes in. Once you add some goals like retirement account contributions or taxable investments in independent brokerage accounts, the simulation will rebalance/invest according to the order of those priorities you define.
I'll definitely look around and see if I can integrate additional historical datasets. That should be a pretty smooth integration if I can find good sources. For taxes, do you think there are some specific ways the tool could maybe be generalized more so that users can adapt it to their country's rules (or at least approximate them) without having to hard-code all the details of every country's tax system?
The premium version has an automatic tax estimation feature which shows a breakdown of estimates for each year in the sim, but it is US-specific at the moment.
The way it currently works is: when a new user onboards and creates a plan, enters some data, and experiments with the app, plan data and results are kept on the client side and not transmitted. Calculations are performed in the browser, and data disappears on refresh. If the user upgrades to Premium, they are then presented with a choice of several data persistence options, including Cloud Storage, LocalStorage Only, and Manual Import/Export. Plan data is only stored server-side if the user enables that option.
You're very welcome! Throughout the course of the pandemic, I went from knowing only a little about personal finance and financial independence, to researching everything I could get my hands on and eventually building this tool. Working on it as my main side project is one of the things that's kept me going through the pandemic months, and it's awesome to see others now enjoying it too.
You should be able to set up one plan where you rent, then clone that plan and make some changes to add a house, and flip back and forth between the two plans to see the differences. Or, another way to do it is to make a single plan for renting but then add a house asset to it configured to cancel rent expenses when in effect, which you can toggle on and off by clicking the icon. When you add a house to a plan, it should ask you whether you'll be paying in full or financing it. If the latter, then it should provide options for interest rate, down payment, monthly payment, and such.
*Incredible* product. I signed up for the monthly membership and, if all goes well, I will likely stick around or buy the lifetime membership.
I currently use Undebt It[0] to manage my debts. It supports all kinds of debt payment plans like snowball, avalanche, cash flow index[1], etc. One feature I love is the "extra debt payment" that basically throws an addition X dollars at the highest interest debt (or whatever debt is prioritized by the selected repayment plan). When that debt is paid off, the amount rolls over to the next debt on the list. This helps a person to pay off debts faster and reduce total interest paid across the lifetime of the debt(s). For a family with a few credit cards, a car payment or two, and a mortgage this can save them tens of thousands of dollars.
Three suggestions:
1. Create an "extra debt payment" feature that goes towards my prioritized debt(s). This amount is in excess of the total minimum payment amounts. It could be towards the highest interest rate, lowest balance, split across all accounts, etc. When a debt is zeroed out the payment automatically adjusts to target the remaining debt(s). Example: two debts, each of $500/mo and an additional $100 "extra" per month for a total outflow of $1100/mo. When the first $500/mo is paid off then new outflow is $600/mo.
2. For each debt "account" add an option to "roll over" the monthly payment when the debt is paid off. This amount would then target the next prioritized debt amount. Example: two debts, each of $500/mo for a total outflow of $1000/mo. When the first $500/mo is paid off the "extra" $500/mo targets the second debt, for an unchanged outflow of $1000/mo.
Combining #1 and #2 example: two debts, each of $500/mo and an "extra" payment of $100/mo for a total outflow of $1100/mo. When the first $500/mo is paid off the "paid off" $500/mo targets the second debt (as well as the "extra" $100/mo), for an unchanged outflow of $1100/mo.
3. Stack the icons on the chart. The vertical scaling of the chart is wonky when adding a 10+ items all in the same year - this makes the chart seem squashed and difficult to parse.
Again - GREAT work. Definitely sent this to a few friends. If you don't respond I will shoot you an email in a few days. I'm sure you're very busy with the new release. Good luck!
Thanks for the thoughtful response! And sure, feel free to continue the conversation over email if you like.
Currently, when you create a debt item or financed asset "X", there should be an "Extra X Payments" financial goal automatically generated, which you can click and drag higher up the list if you care more about allocating extra available yearly income towards that than certain other priorities. Is this feature working for you currently? And how close does it come to addressing / approximating your use cases above?
https://projectifi.io/
A while back I posted a very early version here (https://news.ycombinator.com/item?id=26969173), and just released a major overhaul with loads of new features and enhancements, many inspired by the initial HN commentary:
- Monte Carlo mode with customizable simulations, variables, probability distributions
- Backtesting on historical data
- Multiple data persistence options for subscribers: cloud synchronization, localStorage only, or manual import/export
- Stock/bond allocation curve over time
- Improved support for international use cases (currency + locale selector, custom options and contribution limits for financial goals)
- Ability to quickly switch between deterministic and probabilistic modes
- Many new event types to model a broader range of scenarios
- Better support for married filing jointly / couples planning (perhaps still not perfect, but definitely better)
- Redesigned landing page, additional UI improvements
- And more!
If you feel like checking it out, I would love to hear what you think. Most of the functionality is free, but for anyone interested in upgrading to Premium, you can use coupon code "HN-15" for 15% off all plans :)