Friday, February 23, 2007

Savings Calculator

In one of my first posts (Some Realism), I talked about my million dollar goal, and then the sobering realism that 8 years may not be enough to reach that goal. I realized though that is would be helpful to give to the world that calculator. You can download in here (32K).

The Excel sheet attempts to forecast a regular mutual fund or IRA account, assuming annual contributions that are a percentage of your salary and bonus. It also assumes your salary will increase every year, and that you will receive a promotion every 3 years. After your 6th promotion, I decided to make the promotion every 6 years.

You will need to customize a few variables to yourself. Of note are your starting/current salary, what your annual bonus is as a percentage of salary, and what percent of your salary and bonus you want to save. For more advanced users, you can also manipulate your
annual salary increase, salary increase due to promotion, and investment returns.

The sheet keeps a running total for the next 45 years, and where the "Net" figure goes from red to green is the first year you achieve a $1 million.

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