In the RetireEasy LifePlan we ask you to make a few basic assumptions in order to enable the program to calculate your future finances.

But what should you put down for future rates of inflation, or returns on your investments? Of course if you knew that precisely, you’d be earning a fortune as a financial pundit or fund manager! However, we are just looking for estimates… and, remember, you can always test out different scenarios of your future finances by changing those numbers.

Well to give you a few clues, we have extracted anonymized data from across our whole user basis to let you know what your fellow LifePlan users are thinking. They make for interesting reading…

•         Inflation                                                                     2.22% per annum

•         Income (yield) from investments                                3.18% per annum

•         Growth in investments                                               3.69% per annum

•         Growth in home value                                                3.00% per annum

So are these the figures you should be using?

There’s a strong argument within the theory of the “wisdom of the crowd” that if you combine the collective thinking of enough people you arrive at a sensible conclusion. Looked at another way, extremes are evened out, leaving you with a figure that most people would consider was a sound estimate.

Certainly if you post analysed all the New Year predictions of the financial pundits you’d get a far more realistic figure if you averaged them all out.

Of course the financial markets are never that predictable – it only takes a judder in China or the US for stocks or currencies to plummet. Closer to home, a change in Government or a slow down in economic performance or confidence can have the same impact.

And while house prices are currently steaming away at plus 5% per annum, remember that they have only recently recovered to post crash level. Even regionally things can vary enormously, with growth in London price easily outstripping the regions in the last couple of years.

The FTSE 100 managed to top its pre-crash peak just a few months ago… before fading away once more.

But of course, the predictions by thousands of RetireEasy LifePlan users aren’t looking one year ahead. Or even five… or ten.

In order to really plan for our retirement – which may take us into our 80s, 90s or even beyond – we need to take the long view. And on that basis, allowing for dips and peaks along the way, the sort of numbers being entered by our program users look eminently sensible and reasonably conservative.

Of course, if your portfolio is a particularly adventurous one, you might be in for a bumpy ride – but if you’re that hands on with your investment management then you will put that thinking into your estimates.