Retirement planning

Will my retirement plan actually work? Project the accumulation phase forward with compound interest, compute the target nest egg from your expected spending, then model the drawdown phase using the same PMT formula a mortgage uses - your retirement is mathematically a loan you're paying yourself. Deterministic numbers, no glossy advisor PowerPoint.

When to use this pack

You're 35 years old with $100,000 saved, contributing $1,500/month, retiring at 65 and you want an honest answer to: will the nest egg get there? How much can I draw down per year without running out? What happens if I retire 5 years earlier - or contribute $500/mo less? The accumulation phase, the target calculation, and the drawdown phase are all the same handful of textbook formulas the finance-math kit already implements; this pack composes them into the full plan.

Tools in this pack

All 5 run inside the single $0.050 call above. Each is also callable on its own if you only need one part.

• Compound interest POST /api/compound-interest Compute future value of a principal under compound interest. Returns future value, total interest earned, and the effective annual rate (APY) given the compounding frequency. Matches Excel's FV(rate, nper, 0, -principal) and the classic (1+r/n)^(nt) textbook formula.
• Net present value (NPV) POST /api/npv Compute the net present value of a stream of cashflows at a given discount rate. Index 0 is treated as t=0 (today, not discounted); indices 1..n are discounted by (1+rate)^t. Matches Excel's NPV but with the conventional t=0 treatment most finance textbooks use (Excel itself starts discounting at t=1 - see notes). Use for capital-budgeting decisions: positive NPV = creates value at the discount rate; negative = destroys value.
• Internal rate of return (IRR) POST /api/irr Compute the internal rate of return (IRR) of a cashflow stream - the discount rate at which NPV = 0. Index 0 is treated as t=0 (typically the negative initial investment); indices 1..n are inflows in subsequent periods. Solved via Newton-Raphson with bisection fallback. Requires at least one positive and one negative cashflow (otherwise IRR is undefined). Multiple sign changes in the cashflows can produce multiple IRR roots - we return the first one found.
• Loan payment POST /api/loan-payment Compute the monthly (or per-period) payment on a fully-amortizing loan: mortgage, auto, student loan, business loan. Returns the periodic payment, total paid over the term, and total interest. Matches Excel's PMT(rate, nper, -principal). Use this when you just need the payment number, not the full per-period schedule (see amortization).
• Amortization schedule POST /api/amortization Build the full per-period amortization schedule for a fully-amortizing loan. Each row reports the period number, payment, the principal vs. interest split for that payment, and the remaining balance after that payment. Use this when the user wants to see how interest tapers over the life of the loan, or to model an extra-payment scenario by reading the balance at any period.

Workflow

1. Project the current balance forward with compound-interest. Pass principal=current_savings, annualRate=expected_return, years=years_to_retirement, compoundingPerYear=12 (or 1 for annual). The future value is what your existing balance grows to if you never add another dollar - the 'do-nothing' baseline. Use the post-inflation return (e.g., 7% nominal - 3% inflation = 4% real) if you want today's-dollars output; use nominal if you'll discount spending in nominal terms later.
2. Add the contribution stream's future value. The PMT-to-FV identity says a $X/month contribution for N years at rate r compounds to PMT · ((1+r/12)^(12N) - 1) / (r/12). Easiest path: call compound-interest twice - once on a hypothetical $1/month contribution to get the per-dollar multiplier, then scale by actual monthly contribution. Or use a per-period proxy by calling it with principal=annual_contribution, years=N, and approximating. Sum step 1's result + this contribution FV → projected nest egg at retirement.
3. Compute the target nest egg from expected retirement spending. Build a cashflow stream of negative annual spending over the expected retirement horizon (e.g., 30 years from age 65-95) and call npv with discountRate = expected drawdown return (often lower than accumulation rate - say 4-5% for a bond-heavier retirement allocation). The (negative) NPV's absolute value is the lump sum you need at retirement to fund that spending - your target. Compare against step 2's projected nest egg: if projected > target, you're on track; if projected < target, you have a gap.
4. Compute the sustainable annual withdrawal using loan-payment. Pass principal=projected_nest_egg, annualRate=drawdown_return, termYears=expected_retirement_years, paymentsPerYear=12. The 'payment' the tool returns IS your sustainable monthly withdrawal - the same PMT formula that amortizes a mortgage amortizes a retirement portfolio. The math doesn't care whether you're paying a bank or paying yourself. This is the 'how much can I spend each month?' answer with no rule-of-thumb (e.g. the 4% rule) hand-waving.
5. Pressure-test the trajectory with amortization. Same inputs as step 4 (principal=nest egg, etc.). The schedule's `balance` column shows the year-by-year retirement portfolio balance - useful for sequence-of-returns risk (if early returns underperform the average, the trajectory is much steeper than the smooth assumption suggests). The `interest` column is what your portfolio is earning each year; the `principal` column is what you're actually drawing down. A real plan should have a buffer - if the schedule shows balance hitting zero at exactly your assumed end age, one bad year of returns breaks it. Optional: call irr to back-solve the required return given your target and contributions - useful when the user asks 'what return do I need to retire at 60 instead of 65?'

Call it directly

Any x402 client pays the 402 and gets the whole workflow back in one response:

npx agent402-client call retirement-planning {"scenario":"35 years old with $100,000 saved, contributing $1,500/month, retiring at 65","expectedReturn":"0.07"}

Run it in Claude

claude mcp add agent402 -s user -- npx -y agent402-mcp@latest

Then paste this prompt into Claude:

Build a retirement plan for: 35 years old with $100,000 saved, contributing $1,500/month, retiring at 65, expecting 30 years of retirement, current annual spending of $60,000 (assume 80% replacement = $48,000/yr in retirement). Use Agent402's finance-math kit. (1) Project current $100k forward 30 years at 7%/yr monthly compounding: compound-interest(principal=100000, annualRate=0.07, years=30, compoundingPerYear=12) → expect ~$811k. (2) Project the $1,500/mo contribution stream: easiest is the closed-form PMT-to-FV identity = 1500 · ((1+0.07/12)^360 - 1) / (0.07/12). Compute it (~$1.83M) and add to step 1 → projected nest egg ≈ $2.64M. (3) Target nest egg: build a cashflow stream of [-48000] × 30 (annual retirement spending), call npv at discountRate=0.05 (drawdown-era return) → |NPV| ≈ $738k. Compare projected ($2.64M) vs target ($738k) - comfortably above. (4) Sustainable monthly withdrawal: loan-payment(principal=2640000, annualRate=0.05, termYears=30) → the 'payment' is the monthly draw - expect ~$14,170/mo (~$170k/yr), well above the $48k/yr target. (5) Year-by-year drawdown: amortization(principal=2640000, annualRate=0.05, termYears=30, maxRows=30) - confirm balance trajectory and that final balance is 0. (6) Return: {projectedNestEgg, targetNestEgg, gap, sustainableMonthlyWithdrawal, sustainableAnnualWithdrawal, onTrack: true|false, oneLineConclusion}. All five tools are free over PoW.

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