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Why wouldn’t you? Here’s one thing you can do to pay your future self.
Here’s how to use the calculator:
Your Current Age: It doesn’t matter how old you are. It’s never too late to start.
Anticipated Retirement Age: Most investment vehicles allow penalty-free distributions after 59 1/2.
Current Retirement Savings: Enter whatever you’ve saved so far. Even if you don’t have anything saved yet, don’t worry! You’re about to meet a lovely thing called “compound interest”.
Monthly Amount Invested: Whatever you can afford to put away each month. The more the better, but I recommend having the mindset that you won’t see this money again until your sixties. So, make sure you still have money to live on.
Annual Interest Rate (ROI): The annual rate at which you think your money will grow. Not sure? Your return will vary depending on what you invest your money in. Over the past 50+ years, the average stock market return has been roughly 8%-12%.¹ Somewhere in that range is a good place to start.
Then, click CALC.
Now, that you’ve calculated your personal numbers, let’s talk about what they mean.
Available At Retirement: The total amount of money you’ll have in the account at your Anticipated Retirement Age.
Number of Contributions: The number of times you’ll deposit the Monthly Amount Invested.
Total Amount Invested: The sum of all the deposits you’ve made.
Interest Earned: The amount that your money grew while it was invested, using the Annual Interest Rate (ROI) you entered.
Last Deposit Date: The date of your final deposit.
Great question! I recommend a few things: