'Loss Capacity' simulation: unexpected result

Q: The 'need after the Major Loss' is lower than the 'need from start' of the plan - how should I understand this result?

A: When the 'Loss Capacity' simulation is run, the software will provide 2 results, as follows:

  1. Need from Start
  2. Need after Major Loss

1. Need from Start – what does this result mean?

This is the average annual return which, if achieved in every year of the plan, excepting the already-specified 'major loss' year(s), will suffice to ensure that there is no shortfall in any single year of the plan.

2. Need after Major Loss – what does this result mean?

This is the average annual return which, if achieved in every year after the 'major loss', will suffice to ensure that there is no shortfall in any single year of the plan. Note that – in contrast to the 'Need from Start' result – this result takes as a given one's starting assumptions about investment returns, prior to the incidence of the market deviation.