I Built an Investment Simulator That Models the Journey - Not Just Compound Interest

Description and use

The tool models a complete investment journey, accounting for real actions, and attributes each decision’s impact using Shapley analysis.

Problem

Traditional investment calculators simplify returns to a single compound‑interest equation, ignoring real‑world actions such as SIP step‑ups, pauses, lump sums, withdrawals, rebalancing, taxation, inflation, and changing timelines.

Outcome

The simulator enables users to model complex investment journeys, view real‑wealth outcomes, and understand the combined effects of multiple decisions, thereby improving investment planning accuracy.

Workflow

• 1. Install the package via pip install investment-journey-simulator or run the live Streamlit app.
• 2. Define investment parameters: monthly SIP, step‑up schedule, lump sums, withdrawals, rebalancing rules, tax assumptions, and inflation rate.
• 3. Set multiple horizon checkpoints (e.g., 5, 10, 15, 25 years).
• 4. Run the simulation to generate portfolio trajectories.
• 5. Use the Shapley‑based attribution feature to quantify each decision’s impact across all combinations.
• 6. Compare different plans or the same plan at different start times to evaluate trade‑offs.
• 7. Validate results against real‑world data or adjust assumptions as needed.

Evidence

The simulator models contributions, SIP step‑ups, pauses, lump sums, withdrawals, rebalancing, taxation and changing timelines as part of one investment journey rather than treating investing as a single compound‑interest equation.

Source

It evaluates how each decision contributes across different combinations, then allocates the interaction effects so the individual contributions reconcile with the actual outcome gap.

Source