3-PEAT Variable Withdrawal Sim

i-orp is a web tool from James S. Welch, Jr. that optimizes a retirement plan using steady investment growth rates. A single run of the model suggests an annual spending amount that can be counted upon to continue to the end of the planning horizon. But the steady investment growth rate assumption does not match what the markets deliver, so the available spending value from this single model run can not be counted-upon in down markets. This is sometimes referred to as the "sequence of returns" aspect of retirement planning.

The idea for this app came from James' 3-PEAT paper, where he outlines how output balances from the first year of a model run may be altered based on historical investment rates and used to feed into a second model run. As this process continues, the result is how a retiree's available spending might look if the returns in the future map to those of some earlier era.