Educational information, not individual financial advice.
Key Takeaways
The Horizons Retirement Readiness score is a single 0–100 number summarizing your plan's strength. It's a useful at-a-glance summary, but understanding what's behind the number is important for acting on it.
The score is an adaptive-denominator weighted average of five components:
Funded Ratio (30 points, always included). Your portfolio at retirement divided by the spending it needs to cover over your retirement horizon. Calculated as: portfolio at retirement ÷ (annual expenses × years in retirement). A 1.0 funded ratio means the portfolio exactly covers expected spending at zero return. Higher is better; typically a well-funded plan is 1.3+.
Withdrawal Rate Safety (25 points, always included). Your first-year withdrawal rate as a fraction of portfolio. Scored linearly between a 3.5% floor (full 25 points) and a 7% ceiling (zero points). Lower withdrawal rate = safer.
Risk Resilience (15 points, always included). How well the plan holds up across Monte Carlo scenarios. Uses the simulation's failure rate when available; estimated from Funded Ratio and Withdrawal Rate otherwise.
Income Replacement (20 points, conditional). Ratio of retirement income (Social Security, pension, portfolio withdrawals) to pre-retirement income. Included only if the user has modeled retirement income sources. Scored on a 0–80% target (where 80% is considered full replacement).
Income Gap Coverage (10 points, conditional). How well the plan covers the gap between retirement and major guaranteed income starting (e.g., Social Security at 70 for someone retiring at 62). Included only if the user has specified both retirement date and guaranteed income timing.
The score is not always scored against 100 total points. Instead, the denominator adapts to what's applicable:
This prevents portfolio-funded retirees without modeled Social Security/pension from being artificially capped — the score reflects their actual plan quality, not a penalty for not modeling income they may or may not receive.
Showing a generic example — not your plan.
The Retirement Readiness Score is an adaptive-denominator sum of 5 components. Conditional components are excluded from both numerator and denominator, so a portfolio-funded retiree without Social Security data isn't unfairly penalized.
These are rough guides; a 78 isn't meaningfully different from an 82. Use the score as a directional signal, not a rigid target.
If your overall score is low, look at individual components to see where:
Low Funded Ratio. Portfolio isn't big enough relative to spending needs. Levers: save more, retire later, spend less.
High Withdrawal Rate. Drawing too fast. Levers: reduce spending, delay retirement, increase guaranteed income.
Low Risk Resilience. Plan survives the average case but fails in bad scenarios. Levers: more conservative allocation, larger safety margin, flexible spending.
Low Income Replacement. Retirement income is much less than working income. May indicate inadequate guaranteed income sources.
Low Income Gap Coverage. Portfolio has to cover a long pre-income gap. Levers: delay retirement, start guaranteed income earlier.
The readiness score is a summary; it necessarily loses information. Things it doesn't explicitly capture:
Flexibility. Plans with high flexibility (ability to cut spending, part-time work, downsizing options) are more robust than rigid plans with the same score.
Tail risk specifics. A plan with 95% success and 5% catastrophic failure has a different risk profile than 90% success with mild shortfall in failed trials. The score doesn't distinguish.
Specific expense categories. Healthcare or long-term care can produce large outlier events not captured in average-expense modeling.
Estate goals. Someone who wants to maximize legacy to heirs has different needs than someone who wants to "die with zero." The score treats both the same.
Sequence-of-returns bad luck. A specific bad-luck retirement start can damage a high-score plan; the score reports probability, not certainty.
Track over time. As your situation changes (savings, market returns, life events), the score should update. Trends matter more than any single reading.
Compare alternatives. Different scenarios (retire at 62 vs 65, Roth conversion strategy, different allocation) produce different scores. Use the score as a comparison tool.
Don't over-engineer to max it. Chasing 98 vs 92 often means over-saving and under-living. Target a comfortable level, not a ceiling.
Use alongside other views. Percentile bands, individual trial traces, and detailed cash-flow views complement the score. The score is a summary; the details are still worth examining.
Common patterns:
The Readiness score appears prominently on your Retirement page. The contributing components are visible on hover or expansion, showing which dimensions are strong and which are weak. Scenario comparisons show how the score changes across different plan variations.
Your readiness score is 76. One component — Income Replacement — is 0 because you haven't modeled any Social Security or pension. What does the adaptive denominator do for you?
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