The Assumptions page is where you set the knobs that drive every projection, in four cards: Asset Allocation, Average Returns, Default Inflation Rates, and Simulation Parameters. The defaults are deliberately conservative and aligned with long-run historical averages - they're a reasonable starting point for most users. Adjust them when you have a specific view, not just to make the plan look better.

Assumptions belong to one plan. Every plan you hold carries its own set, which is what lets two plans be genuinely different scenarios - and also means changing your mind about a rate does not reach your other plans by itself. Each card carries an Apply to all plans button for exactly that; see below.

Changing them from a results page

Three of these numbers - stocks, bonds and inflation - also sit in a small strip at the top of the pages that show what they produce: the Dashboard, Cash Flow, Time Machine, the What-If Explorer and the optimizers. Nudge one there and the page in front of you moves, instead of coming here, changing it, and going back to see what happened.

It is the same setting, not a preview and not a scenario. A change made there is a change to the plan, and it appears on this page and everywhere else the moment you make it. While you are experimenting, the strip offers Revert, which puts all three back to what they were when you started.

If it is in the way, hide it with the X. The toolbar button beside the plan name brings it back, and remembers which you chose.

Average returns

Three rates, all arithmetic annual averages:

• Stocks - default 8%. The historical long-run total return on US large-cap stocks (S&P 500 with dividends reinvested) is roughly 9-10% before adjusting for survivorship and selection bias, and modestly lower going forward by most forecasts. 8% is a common middle-ground assumption.
• Bonds - default 4.5%. Close to long-run intermediate-term Treasury total returns. Higher than recent decades but lower than the 1980s yield environment.
• Cash - default 2.5%. Roughly aligned with long-run cash / money-market yields. If you have a specific high-yield savings rate, set it on each Cash account individually - that per-account APY overrides this default.

These are average assumptions. Each Monte Carlo iteration draws random returns around them; the median path will compound slightly below the arithmetic mean because of volatility drag (an inherent property of any distribution with non-zero variance). See Monte Carlo simulations.

Common pitfall: setting stocks to 10-12% to make the plan look better. That inflates your success rate on screen without changing what's actually likely to happen - it just hides risk. If you want to stress-test optimistic vs pessimistic outlooks, treat the change as a deliberate scenario, not a base case.

Asset allocation

You set two mixes, each across stocks, bonds and cash, and each row must total 100%. Bonds is the remainder - type a stocks and a cash figure and bonds fills the gap - and the calculator icon beside cash sets cash to whatever is left over.

• Pre-retirement. The blend the engine uses while you're still earning. Most users keep this stocks-heavy (e.g. 60/40 default) because the long horizon absorbs volatility.
• Post-retirement. The blend that takes over at your retirement age. Conventional advice is to step down the stock share at retirement (e.g. 50/50 default) to reduce sequence-of-returns risk in the early drawdown years.

The shift happens at your retirement age - the engine doesn't currently model a continuous glide path, just the two phases.

Cash appears in two places and they do different jobs. The cash share here is how much of the portfolio sits in cash; the cash return on the Average Returns card is what that share earns. A Cash account carrying its own APY overrides that rate for the account's own balance.

Inflation rates

Two rates, applied differently across the plan:

• General inflation - default 2.54%. Roughly the long-run US CPI average. Used as the default growth rate for recurring expenses and as the basis for today's-dollars to future-dollars conversion.
• Medical inflation - default 3.36%. Healthcare costs have historically risen faster than the CPI; the engine offers a separate rate so healthcare expenses, Medicare premiums, IRMAA tiers, and LTC costs can grow at their own pace.

Each recurring expense line picks one of these or a custom rate - see How inflation works in the plan.

Simulation parameters

These tune how the simulation generates uncertainty around your average return assumptions:

• Simulation mode. The first control on the card, because it decides which of the others apply. Monte Carlo draws each year's returns from a normal distribution, and uses the standard deviations and correlation below. Historical Simulation resamples contiguous blocks of real 1872-onward market data, and uses the block length instead. The same toggle sits on the Monte Carlo chart; it is one setting shown in two places. See Historical market simulations for the trade-offs.
• Stock volatility (sigma) - default 17%. The standard deviation of annual stock returns. Higher sigma = wider outcome bands and more frequent extreme years.
• Bond volatility (sigma) - default 8%. Same idea for bonds. Lower because bond returns have historically been less variable.
• Stock-bond correlation - default -0.20. The correlation coefficient between annual stock and bond returns. Negative values mean stocks and bonds tend to move in opposite directions, which is the long-run historical pattern. Plays a meaningful role in how the 60/40 or 50/50 portfolio smooths over time.
• Use fixed seed. When on, every run uses the same pseudo-random sequence, so results are perfectly reproducible across reloads and plan tweaks - changes you see are because of your inputs, not random variation. Turn it off if you want to see how much the result depends on luck of the draw across runs.

Restore defaults

Every card has one, and it resets only that card's own values - restoring your return assumptions no longer disturbs your allocation, and vice versa. The button greys out when the values already are the defaults, so a greyed one means there is nothing to restore rather than something being wrong.

One detail worth knowing on Asset Allocation: bonds has no default of its own because it is the remainder, so restoring clears any bonds figure you typed and lets it go back to filling the gap. That is why the row lands back at 60/40/0 rather than keeping your bond number.

Apply to all plans

Each card can push its values into every other plan you hold. Use it when you have changed your mind about something that is not really a scenario - a preferred inflation rate, a lower long-run return - and want the change to reach the plans you are not currently looking at.

What it touches:

• Only that card's fields. Applying inflation rates does not carry your allocation or your simulation parameters with it. Everything else in each target plan is left exactly as it was.
• Only plans you own and have not archived, and not the plan you have open, which is the source. Archived plans are left alone deliberately - you set them aside - and plans shared with you are never written to, because they belong to somebody else.

The confirmation lists the plans by name, so you can see what you are about to change rather than approving a count. There is no undo, and each plan it touches will recalculate its results the next time you open it. If a plan cannot be written - an encrypted plan while your session is locked, say - it is skipped and named, and the rest still go through.

Iteration count

Fixed at 2,000 iterations. More iterations smooth the percentile bands but add no new information past a few thousand draws. The figure is large enough that the 20th-80th percentile band stabilizes well across reruns.

When to adjust the defaults

The defaults work for most users. Consider changing them when:

• You hold a clearly different long-run market view (e.g. you assume lower returns going forward because of valuation levels).
• You're modeling a non-standard portfolio - higher cash allocation, all-bond mix, alternative investments.
• You want to stress-test against an aggressive crash by raising the sigma values temporarily.

Otherwise, the most useful experiments tend to be on the input side - retirement age, Social Security claiming age, conversion strategy - not the assumption knobs.