Retirement planning
Retirement planning, in a financial context, refers to the allocation of savings or revenue for retirement. The goal of retirement planning is to achieve financial independence. The process of retirement planning aims to: Obtaining a financial plan. Producers such as a financial planner or financial adviser can help clients develop retirement plans, where compensation is either fee-based or commissioned contingent on product sale; see Professional certification in financial services. Such an arrangement is sometimes viewed as in conflict with a consumer's interest, and that the advice rendered cannot be without bias, or at a cost  that justifies its value. Consumers can now elect a do it yourself (DIY) approach. For example, retirement web-tools in the form of a calculator, mathematical model or decision support system are available online. A web-based tool that allows client to fully plan, without human intervention, might be considered a producer. Key motivations of the DIY trend are many of the same arguments for lean manufacturing, a constructive alteration of the relationship between producer and consumer. Modeling and limitations. Retirement finances touch upon distinct subject areas or financial domains of client importance, including: investments (i.e., stocks, bonds, mutual funds ); real estate; debt; taxes; cash flow (income and expense) analysis; insurance; defined benefits (e.g., social security, traditional pensions). From an analytic perspective, each domain can be formally characterized and modeled using a different class representation, as defined by a domain's unique set of attributes and behaviors. Domain models require definition only at a level of abstraction necessary for decision analysis. Since planning is about the future, domains need to extend beyond current state description and address uncertainty, volatility, change dynamics (i.e., constancy or determinism is not assumed). Together, these factors raise significant challenges to any current producer claim of  model predictability or certainty. Volatility in investment markets raises questions for everyone, participants, and fiduciaries alike. With the growth of 401(k) and other individual account retirement plans, many participants are responsible for investing their retirement savings. Monte Carlo method. The Monte Carlo method is the most common form of a mathematical model that is applied to predict long-term investment behavior for a client's retirement planning. Its use helps to identify adequacy of client's investment to attain retirement readiness and to clarify strategic choices and actions. Yet, the investment domain is only a financial domain and therefore is  incomplete. Depending on client context, the investment domain may have very little importance in relation to a client's other domains—e.g., a client who is predisposed to the use of real estate as a primary source of retirement funding. Other models. Contemporary retirement planning models have yet to be validated in the sense that the models purport to project a future that has yet to manifest itself. The criticism with contemporary models are some of the same levied against Neoclassical economics. The critic argues that contemporary models may only have proven validity retrospectively, whereas it is the indeterminate future  that needs solution. A more moderate school believes that retirement planning methods must further evolve by adopting a more robust and integrated set of tools from the field of complexity science. Recent research has explored the effects of the elimination of capital income taxes on saving-for-retirement opportunities and its impact on government debt.