I see slight changes when I rerun a plan. Why?

Sometimes we hear that, when rerunning or updating a plan, plan results differ from what was there before. For example, the retirement paycheck may change by $100 dollars in either direction. 

Here are a few reasons you might see this, but the most likely reason stems from effects moving from one month to another. Each month, at the beginning of the month, Income Lab updates all of its data, including inflation and economic data, historical returns, and capital market assumption defaults. Running a plan on March 31 and April 2 will therefore yield slightly different results. 

From month to month, plan length and resource timing also changes. If you run a plan in March, clients are a certain age and cash flows are expected a certain number of months from now. In April, they are one month older and those cash flows are one month closer. These differences result in different plan lengths and slightly different calculations of when portfolio withdrawals will come. If the last time a plan was run was several months ago, the differences would be even bigger.

If this is not the reason, we often see that someone is not aware of small changes they made to the plan. Therefore, the best thing to do is to rerun the plan a few times and confirm that the values are stable. If they are, this confirms that the differences were either due to the elapsing of time or to changes in the plan inputs.