How Horizon works
Every number in Horizon comes from a deterministic formula — no black boxes, no AI guesswork. Here's exactly what the model does.
The simulation model
Horizon runs a year-by-year simulation from your current age to your planning end age. Each year is classified into one of three phases: Earning (before retirement), Retired (between retirement age and planning end age), or Dead (simulation ends, portfolio set to zero).
In each year, the model grows the portfolio by the weighted return for that phase, adds income (if earning), subtracts spending (if retired), and produces an end-of-year balance. That balance becomes the start of the next year.
Portfolio calculations
Earning phase
During earning years, any withdrawal from the portfolio is grossed up for tax — if you withdraw $100 and the blended tax rate is 25%, the model withdraws $133.33 to net $100 after tax. Income contributions are added post-tax.
− extraWithdrawal ÷ (1 − taxRate)
+ annualIncome
Retirement phase
In retirement, spending is treated as already post-tax — no gross-up. Spending starts at your retirement spending figure projected to retirement-year dollars via inflation, then grows by the inflation rate each subsequent year.
− annualSpending
− extraWithdrawal
Blended rates
When you configure multiple asset classes, Horizon computes a single blended rate from them:
retirementReturn = Σ(returnRate × weight) ÷ Σ(weight)
withdrawalTaxRate = Σ(taxRate × weight) ÷ Σ(weight)
All weights must sum to 100%. The model validates this before running.
Key assumptions
| Model type | Deterministic — no Monte Carlo, no stochastic returns |
| Inflation | Applied annually to retirement spending only |
| Tax gross-up | Applied to withdrawals during earning phase only |
| Income growth | Salary growth rate applied annually to monthly contribution |
| Retirement spending | Entered in today's dollars; inflated to retirement-year dollars at start of retirement |
| Portfolio floor | Charts display zero (never negative); warnings shown in table |
| Planning end age | Not a mortality prediction — the age to which you want to ensure solvency |
Not financial advice
Horizon is a planning tool, not a financial advisor. All projections are illustrative and based on fixed assumed rates of return. Real markets are volatile — actual returns will differ from projections. Consult a qualified financial professional before making investment or retirement decisions.