4 Numbers That Can Wreck Your Financial Plan: Fix Your Assumptions Today!

• Financial plans often rely on 4 optimistic assumptions: 12% returns, 6% inflation, 85-year life expectancy, and 10% annual salary growth.
• Underestimating inflation (e.g., 4% vs. actual 6-12% for specific goals) significantly increases future expenses, eroding savings faster.
• Overestimating investment returns (e.g., 12%+ consistently) ignores portfolio shifts to safer assets and market fluctuations; 11-12% is more realistic.
• Underestimating life expectancy (e.g., 85 years) can leave you without funds if you live longer, requiring a larger retirement corpus.
• Assuming consistent 10% income growth ignores career breaks, job changes, and market realities, making conservative estimates safer.

Why It Matters: Regularly review and adjust your financial planning assumptions to avoid future shocks and ensure long-term security.