Easy

Planning Tool

DYI:  Developed by Fidelity Investments, they adjust for the 4 percent average inflation rate projected by the Social Security Administration and assume you’ll earn 8 percent a year on your savings.

5 years:    .184

10 years:  .083

15 years:  .050

20 years:  .034

25 years:  .024

30 years:  .018

Example:  If you plan to stop working twenty years from now, in order to accumulate $250,000 dollars, you’d need to save $8,500 every year (.034 x $250,000) in today’s dollars for the next two decades.

How much will you need to save over 30 years to accumulate one million dollars?  $18,000 per year or $1,500 per month, obviously a difficult task especially those at the lower income range.

Nevertheless, an easy tool for savings/retirement planning.

ENJOY

DYI