A Monte Carlo simulation is a computational tool used in financial planning to model the probability that your retirement savings will last throughout your lifetime. It runs thousands of scenarios using random variations in market returns, inflation, and spending to show you a range of possible outcomes rather than a single projected number. For example, a simulation might show that your plan has an 85% chance of success, meaning your money outlasts you in 85 out of 100 modeled scenarios. Financial planners use Monte Carlo simulations to stress-test retirement plans and identify weaknesses before they become real problems. It's a more realistic planning approach than assuming a single average return, because it accounts for the unpredictability of actual markets.