Assumptions & Limitations Guide

Common default assumptions

• Inflation: long-run U.S. CPI in the ~2.5–3.0% range, editable per tool.
• Investment returns: nominal long-run equity returns in the ~6–8% range; conservative real returns ~4–5%. Bond and cash returns are lower and tool-specific.
• Taxes: simplified federal treatment based on user inputs; state and local taxes generally excluded unless specifically modeled.
• Expenses & fees: investment fees, fund expense ratios, advisory fees and trading costs are generally not modeled unless a tool says so.
• Contribution schedules: assumed constant in real or nominal terms as labeled.
• Compounding: annually or monthly per tool convention.

Material simplifications

• No sequence-of-returns modeling unless explicitly noted.
• No Monte Carlo simulation unless explicitly noted.
• No modeling of changes in tax law, contribution limits or Social Security rules over time.
• No modeling of insurance, healthcare costs or long-term-care risk unless explicitly noted.

Why this matters

The further out a projection runs, the more sensitive it becomes to its assumptions. Use defaults as a starting point, change them to reflect your circumstances, and treat outputs as ranges rather than precise figures.

Related

See Projection Methodology, Inflation & Economic Assumptions and the Market Volatility Statement.