{"id":121737,"date":"2025-03-09T08:17:31","date_gmt":"2025-03-09T08:17:31","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/investing\/using-chatgpt-to-help-with-projecting-financial-freedom-numbers\/"},"modified":"2025-03-09T08:17:31","modified_gmt":"2025-03-09T08:17:31","slug":"using-chatgpt-to-help-with-projecting-financial-freedom-numbers","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=121737","title":{"rendered":"Using ChatGPT to help with projecting Financial Freedom numbers"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div id=\"post-body-4168976916953272251\" itemprop=\"description articleBody\">\n<iframe loading=\"lazy\" title=\"Using ChatGPT to help with projecting Financial Freedom numbers\" width=\"840\" height=\"473\" src=\"https:\/\/www.youtube.com\/embed\/aE0XYO6uNxg?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><\/p>\n<p style=\"text-align: justify;\"><span style=\"background-color: white; color: #1c1c1c; font-family: arial; font-size: medium;\">This will be the first of a 4-part series which explains the different concepts covered in the Excel financial freedom template that I have created. I used ChatGPT to help with writing some of the excel formulas and macros.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial; font-size: medium;\"><span style=\"background-color: white; color: #1c1c1c;\">The template allows me to project how much I would need to invest to achieve financial freedom,\u00a0<\/span><\/span><span style=\"background-color: white; color: #1c1c1c; font-family: arial; font-size: medium;\">based on different assumptions on investment returns, volatility, saving rates, inflation and expected salary growth. There are also different scenarios built in to the template, which allows me to account for various market environment, such as stagflation, which has high inflation and lower returns, and easy money (QE), with low inflation and higher returns.<\/span><\/p>\n<p style=\"text-align: justify;\"><span style=\"font-family: arial; font-size: medium;\"><span style=\"background-color: white; color: #1c1c1c;\">I was curious to find out the likelihood of an average income fresh grad ($4.2k SGD in 2022) achieving financial freedom. Thought it would be interesting to share the results here.<\/span><\/span><\/p>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"background-color: white; border: 0px; color: #1c1c1c; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0.8em 0px 0.25em; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">The FI targets for this person (25 years old today) looking to achieve\u00a0<em class=\"_7s4syPYtk5hfUIjySXcRE\" style=\"border: 0px; font-stretch: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\"><span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\">Barista FIRE<\/span><\/em>\u00a0are:<\/span><\/p>\n<ul class=\"_33MEMislY0GAlB78wL1_CR\" style=\"background-color: white; border: 0px; color: #1c1c1c; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; list-style-image: initial; list-style-position: outside; margin: 4px 0px 4px 8px; padding: 0px; vertical-align: baseline;\">\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">$3k SGD in monthly passive income (2022 purchasing power, inflation adjusted during projections)<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">4.8% yield on investments via dividend paying stocks<\/span><\/p>\n<\/li>\n<\/ul>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"background-color: white; border: 0px; color: #1c1c1c; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0.8em 0px 0.25em; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">The assumptions are as follows:<\/span><\/p>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"background-color: white; border: 0px; color: #1c1c1c; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0.8em 0px 0.25em; text-align: justify; vertical-align: baseline;\"><span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Salary and Expenses<\/span><\/span><\/p>\n<ul class=\"_33MEMislY0GAlB78wL1_CR\" style=\"background-color: white; border: 0px; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; list-style-image: initial; list-style-position: outside; margin: 4px 0px 4px 8px; padding: 0px; text-align: left; vertical-align: baseline;\">\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; color: #1c1c1c; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">$4,200 salary, take home of $3,360 (net of 20% CPF)<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; color: #1c1c1c; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Expenses of $860 per month &#8211; I know this will be debatable, but let me kindly refer you to this article by Kyith&#8217;s on <a href=\"https:\/\/investmentmoats.com\/financial-independence\/there-are-singaporeans-that-can-keep-their-monthly-spending-within-1000-that-might-be-a-good-thing\/\" target=\"_blank\">Singaporeans spending .<\/a><\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; color: #1c1c1c; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Person receives 2-3 months of bonus per year, which is used to pay taxes, travel expenses and one-off expenses<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; color: #1c1c1c; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">For the first 6 years, assume a +20% increase in salary\u00a0<span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\">every 2 years<\/span>\u00a0due to promotion \/ job change<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; color: #1c1c1c; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">For the following 6 years, assume a +15% increase in salary\u00a0<span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\">every 3 years<\/span>\u00a0due to promotion \/ job change<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; color: #1c1c1c; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Salary increase set at 3% for all other years.<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; color: #1c1c1c; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Savings rate kept constant over time &#8211; Monthly expenses expected to grow at the same rate as salary increases, from $860 to around $2k by the time the person hits their mid-30s.<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; color: #1c1c1c; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Housing: Choose a\u00a0<em class=\"_7s4syPYtk5hfUIjySXcRE\" style=\"border: 0px; font-stretch: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\"><span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\">reasonably priced one<\/span><\/em>, where the monthly mortgage can be serviced by the CPF Ordinary Account contributions of the dual income couple.<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; color: #1c1c1c; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Have received some preliminary comments that the salary increase appears unrealistic. Here are my further thoughts:<\/span><\/p>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"color: #1c1c1c; font-family: arial; font-size: medium;\">The projections include 3 promotions\/job switches in the first 6 years, then 2 promotions\/job switches in the next 6 years. A total of 5, 3 times of 15% and 2 times of 15%. The rest are 3% annually.<\/span><\/p>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"color: #1c1c1c; font-family: arial; font-size: medium;\">Based on this article on Seedly,<\/span><\/p>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"color: #1c1c1c; font-family: arial; font-size: medium;\"><a href=\"https:\/\/blog.seedly.sg\/average-monthly-income-occupation-job-guide\/\">https:\/\/blog.seedly.sg\/average-monthly-income-occupation-job-guide\/<\/a><\/span><\/p>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"color: #1c1c1c; font-family: arial; font-size: medium;\">For Managers &amp; Administrators the median salary for early 40s is 9.5k <b>today <\/b>(115k annual) and 7.5k for Professionals (90k annual). The question should be what would a person in their 40s earn <b>in year 2038 <\/b>for these roles?<\/span><\/p>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"color: #1c1c1c; font-family: arial; font-size: medium;\"><br \/>If we apply a 3% adjustment for inflation per year, then <b>in 2038 <\/b>these people should be getting around 150k (Managers) and 115k (Professionals).<\/span><\/p>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"color: #1c1c1c; font-family: arial; font-size: medium;\">In the example used, <b>at 40 years old (i.e year 2038)<\/b>, the person would be projected to earn around 154k annually based on the assumptions above, so not too far off from the median expected salary for Managers\/Professionals, if we adjust for inflation.<\/span><\/p>\n<\/li>\n<\/ul>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"background-color: white; border: 0px; color: #1c1c1c; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0.8em 0px 0.25em; text-align: justify; vertical-align: baseline;\"><span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Investment Returns &amp; Inflation<\/span><\/span><\/p>\n<ul class=\"_33MEMislY0GAlB78wL1_CR\" style=\"background-color: white; border: 0px; color: #1c1c1c; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; list-style-image: initial; list-style-position: outside; margin: 4px 0px 4px 8px; padding: 0px; vertical-align: baseline;\">\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Projected portfolio return of 5% per annum, with 15% standard deviation (roughly aligns with the historical returns\/std dev of MSCI ACWI)<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">To be conservative, max gain in a year is capped at +30%, while max loss is set at -50%<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Returns are randomised with a normal distribution. This accounts for the\u00a0<em class=\"_7s4syPYtk5hfUIjySXcRE\" style=\"border: 0px; font-stretch: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\"><span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\">sequence of returns<\/span><\/em>\u00a0which is often overlooked when projection investment returns. i.e, if you think you can get 5% returns yearly, people usually just compound this 5% directly without account for the\u00a0<em class=\"_7s4syPYtk5hfUIjySXcRE\" style=\"border: 0px; font-stretch: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\"><span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\">sequence of returns<\/span><\/em>.\u00a0<em class=\"_7s4syPYtk5hfUIjySXcRE\" style=\"border: 0px; font-stretch: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\"><span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\">Real world returns don&#8217;t behave like that.<\/span><\/em><\/span><\/p>\n<ul class=\"_33MEMislY0GAlB78wL1_CR\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; list-style-image: initial; list-style-position: outside; margin: 4px 0px 4px 8px; padding: 0px; vertical-align: baseline;\">\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Since we are investing consistently over a period of time, the sequence of returns matter. For example if the returns over a 5 year period are: +12%, +4%, +16%, +5%, -20%,The 5 year CAGR is 2.5%. Even if you swap the +12% and -20%, the CAGR remains the same at 2.5%.<br \/><\/span><span style=\"font-family: arial; font-size: medium;\"><br \/>But if you invest a fixed amount across the 5 years, your ending amount would be different. Thus randomising the returns accounts for this.<\/span><\/p>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<ul class=\"_33MEMislY0GAlB78wL1_CR\" style=\"background-color: white; border: 0px; color: #1c1c1c; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; list-style-image: initial; list-style-position: outside; margin: 4px 0px 4px 8px; padding: 0px; vertical-align: baseline;\">\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Note: real world stock market returns exhibit\u00a0<em class=\"_7s4syPYtk5hfUIjySXcRE\" style=\"border: 0px; font-stretch: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\"><span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\">fat tail distributions<\/span><\/em>, which were not accounted for here.<\/span><\/p>\n<\/li>\n<li class=\"_3gqTEjt4x9UIIpWiro7YXz\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0.4em 1em; padding: 0px; vertical-align: baseline;\">\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: inherit; line-height: inherit; margin: 0px; padding: 0px; text-align: justify; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Inflation is set at 2.5% for the base case. In the template, inflation can be adjusted based on scenarios, e.g. 5% in a stagflation environment.<\/span><\/p>\n<\/li>\n<\/ul>\n<p class=\"_1qeIAgB0cPwnLhDF9XSiJM\" style=\"background-color: white; border: 0px; color: #1c1c1c; font-stretch: inherit; font-variant-east-asian: inherit; font-variant-numeric: inherit; line-height: inherit; margin: 0px; padding: 0.8em 0px 0.25em; text-align: justify; vertical-align: baseline;\"><span class=\"_12FoOEddL7j_RgMQN0SNeU\" style=\"border: 0px; font-stretch: inherit; font-style: inherit; font-variant: inherit; font-weight: 700; line-height: inherit; margin: 0px; padding: 0px; vertical-align: baseline;\"><span style=\"font-family: arial; font-size: medium;\">Results<\/span><\/span><\/p>\n<p><span style=\"color: #1c1c1c; font-family: arial; font-size: medium;\"><span style=\"background-color: white;\">Please watch my YouTube video above for a full walkthrough of the template. I will be discussing some of the concepts mentioned in the video in the coming weeks.<\/span><\/span><\/p>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>This will be the first of a 4-part series which explains the different concepts covered in the Excel financial freedom template that I have created. I used ChatGPT to help with writing some of the excel formulas and macros. The template allows me to project how much I would need to invest to achieve financial [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":121738,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[96],"tags":[7432,10912,6465,6945,53712],"dealstore":[],"offerexpiration":[],"class_list":["post-121737","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing","tag-chatgpt","tag-financial","tag-freedom","tag-numbers","tag-projecting"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Using ChatGPT to help with projecting Financial Freedom numbers - Som2ny Network<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fivemor.com\/?p=121737\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Using ChatGPT to help with projecting Financial Freedom numbers - Som2ny Network\" \/>\n<meta property=\"og:description\" content=\"This will be the first of a 4-part series which explains the different concepts covered in the Excel financial freedom template that I have created. 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