Methodology
How Zenarios calculates
Zenarios forecasts your net worth month by month, from today until the end of your plan. This page explains how, and where the numbers it suggests come from.
A forecast, month by month
For every month of the plan, Zenarios works out pay, taxes and social contributions, spending, loan payments, savings and investment returns, then carries the result into the next month. Milestones such as buying a home, having a child or going part-time change the cash flows from the month they happen. Everything is calculated on your phone.
Default assumptions
Every assumption can be changed. Until you do, Zenarios uses these:
| Inflation | 2 % a year |
|---|---|
| Return on investments | 5 % a year (3 % for a cautious mix) |
| Interest on cash | 1.5 % a year |
| Home prices | 2 % a year |
| Cars | lose 15 % of their value a year |
| Pay | rises with inflation |
| Withdrawal rate | 3.5 % a year |
Future amounts can be shown at today's prices, adjusted for inflation, or as they will be paid.
Taxes
Income tax and social contributions are worked out for 38 countries. Twelve have full detail: Germany, Austria, Switzerland, the Netherlands, Belgium, Luxembourg, the UK, Ireland, the US, Canada, Australia and New Zealand. Another 26 follow their national rules in a simpler form, and anywhere else you enter one tax rate, with a suggestion from OECD Taxing Wages. Investment income and gains are taxed by each country's rules, including allowances, and accounts can be taxable, tax-free or tax-deferred. Tax rules are simplified, so treat results as estimates.
Pensions
For German plans, the statutory pension is worked out from pension points, the age you claim it and the adjustment for claiming early or late. For other countries, state pensions are estimated from published rules or OECD replacement rates. You can always enter a fixed amount instead.
Financial independence
Zenarios marks financial independence from the month your cash and investments, drawn down at the withdrawal rate, plus regular income such as pensions, cover a full year of spending after tax. Money you can't reach yet, such as a pension that starts later, only counts once it's available. The default withdrawal rate is 3.5 %, a little below the well-known 4 % rule; a stress test compares the two.
Stress tests and market futures
Thirteen stress tests throw a shock at your plan: job loss, a pay cut, rising costs, a big bill, a market crash, a crash as you retire, an inflation spike, higher loan rates, falling house prices, a lost decade, a recession, a long life and market history. Each ends in a plain verdict: Holds, Gets tight or Runs short.
The Monte Carlo simulation plays up to 1,000 market futures. Returns are fat-tailed, centred on your return assumption, and inflation drifts around its assumption. The same plan always meets the same futures, so results don't jump between visits.
History replays run your plan through real US market returns and inflation from 1872 to 2025, with ready-made starts in 1929 (the Great Depression), 1966 (inflation and flat markets), 1973 (the oil crisis), 2000 (the dot-com bust) and 2008 (the financial crisis).
Where the suggestions come from
Living costs, rents, home prices, taxes and pensions come from official statistics and published rules, bundled with the app, so nothing is looked up online. Living-cost levels cover 153 countries, and local rents and home prices cover areas in 12 countries. The main sources:
- OECD: Taxing Wages; Pensions at a Glance
- Eurostat: Purchasing power parities and price level indices; HICP
- World Bank: World Development Indicators
- Destatis: Einkommens- und Verbrauchsstichprobe (EVS) 2023
- German Federal Ministry of Finance: Income tax, solidarity surcharge and social insurance rates
- BBSR: INKAR district rents
- Kiel Institute for the World Economy: GREIX German Real Estate Index
- Robert J. Shiller: U.S. stock markets 1871 to present
- Aswath Damodaran, NYU Stern: Historical returns on stocks, bonds and bills
National statistics offices supply rents and home prices outside Germany. The app lists every source, with the date it was checked, under Settings → Data sources and rules.
What Zenarios is not
Zenarios shows estimates based on what you enter and on simplified rules. It is not financial, tax or legal advice, and it doesn't connect to banks or move money.