REACHING YOUR SAVINGS GOALS

If you are trying to save for the future, you can either commit a lump sum or put in so much per year. The most effective and accurate method to determine how much that is is through using a financial calculator. But, absent that, the simple form below should help give you a rough estimate on what you need to contribute.

A. Amount you need in the future ___________________________________

B. Years till needed ___________________________________

C. Amount already saved ___________________________________

D. What will it be worth in the future. ___________________________________

Line C times Factor 1

E. Additional funds needed ___________________________________

Line A minus line D

F. Amount that will be met from other sources ___________________________________

(Gifts, loans, etc.)

G. Total amount needed ___________________________________

(Line E minus F)

H. Annual savings to reach goal ___________________________________

Line G divided by Factor 2)

I. Amount needed to invest each week ___________________________________

Line H divided by 52.

FACTOR 1- What your savings will be worth in the future
Number of Years till needed Annual Return on Investments (After Taxes)

3% 6% 8% 10%
1 1.0300 1.0600 1.0800 1.1000
3 1.0927 1.1910 1.2597 1.3310
5 1.1593 1.3382 1.4693 1.6105
10 1.3439 1.7908 2.1589 2.5937
15 1.5580 2.3966 3.1722 4.1722
20 1.8061 3.2071 4.6610 6.7275
25 2.0938 4.2919 6.8485 10.8340

Factor 2- How much you need to invest to meet funds needed
Number of Years till needed Annual Return on Investments (After Taxes)


3% 6% 8% 10%
1 1.000 1.000 1.000 1.000
3 3.0909 3.1836 3.2464 3.3100
5 5.3091 5.6371 5.8666 6.1051
10 11.463 13.180 14.486 15.937
15 18.598 23.276 27.152 31.772
20 26.870 36.785 45.762 57.275
25 36.459 54.864 73.105 98.347


GROWTH OF TAX DEFERRED LUMP SUM AND MONTHLY CONTRIBUTIONS

Money Market- 4% Bonds- 6% Stocks- 10% Blend- 7%
$25,000 in 10 years 37,000 44,800 65,000 49,000
$400 per month in 10 years 59,000 65,500 82,600 69,000
Total $96,000 $110,300 $147,000 $118,000
$25,000 in 25 years 66,000 107,200 271,000 136,000
$400 [per month in 25 years 206,000 277,000 531,000 324,000
Total $272,000 $384,400 $802,000 $460,000

RICH: (1999) The richest 1% are middle aged and old, they are married, they are well educated. Nearly all are white. Households in the poorest 20% are generally young, about 66% are single; more than 33% have not finished high school. Only about 50% of these are white. Most of the wealth is in the form of unincorporated business real estate. They are owners of small businesses or professional practices. Stocks, bonds and other financial assets represent less than 33% of total value.

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