BASIC EXPLANATION OF A RETIREMENT PLAN WITH A RETIREMENT CALCUL

Calculator

Initial Amount Invested

30,000 10% 20 201,825 131,186

Annual Rate of Return(%) Years Invested

Final Amount at Retirement

Net of Taxes (35%)

Income Tax Rate

What can you do with the money at age 65

Explanations and Suggestions for approaching Retirement Money

Based on common sense, where you can Invest your 30,000 dollars saved, as a basic, 10 year, or 20 year investment alternative: In an S&P 500 Index Fund. See S&P 500 Historical Returns in Table below. This is also called passive investment because you simply follow you choose a reliable an index, you dont choose a particular money manager, mutual fund company that offers an index fund.

Source of Table: Historical Annual Returns For The S&P 500 Index. X

website link to table in september 2012: http://www.istockanalyst.com/article/viewarticle/articleid/2

NT PLAN WITH A RETIREMENT CALCULATOR

Youve saved 30,000 dollars today, and youre more or less 45 years of age, with about 20 years until r
USD

You can change the currency here, to your countrys currency, it will adjust the other currency cells automa

Annual percentage of amount invested generated every year. Assumes reinvestment of interest every yea

Assumes you start saving for retirement at age 45, until age 65, for twenty years, and so assumes you will
USD

At age 65, you have a lump sum of $201,825 dollars, slightly more than two hundred thousand dollars.

USD

Net of taxes, the lump sum at age 65 becomes $131,186, over one hundred thirty thousand dollars availab from your banks checking or savings account.

This amount is a lump sum, not an annuity, for living expenses from the age of 65, until you die. It is a lump sum accumulated over 20 years of investing 30 thousand dollars, at 10% annual interest on tha After 20 years, you reach the lump sum of 201.825, slightly more than 200.000 dollars

Net of Income Taxes (Final Amount at Retirement reduced by income taxes, which you can adjust), you ca

Assuming youll die at age 95, this means about $364 dollars ($131,186 dollars / 30 years) / (12 months pe

Assuming youll die at age 85, this means about $546 dollars ($131,186 dollars / 20 years) / (12 months pe

Numbers are meant to be somewhat average, you can adjust to your case in the adjacent spreadsheet. Y

This shows the power of compound interest, over 20 years well invested, in something like a passive index

With these numbers, you can approach an insurance company today, at age 45, and see what they can of

alled passive investment

If you bring to them 30 thousand dollars today, what is the lump sum or annuity they can offer, net of taxes

icular money manager,

The other alternative is to approach a mutual fund company such as Fidelity Investments or Vanguard to in

for 20 years, seeing what historical rate of return the fund has achieved over 10 years, minimum 5 years, c

rns For The S&P 500 Index. X

Youd want to take into account these two columns, a twenty year and look at the row titled 2007, the one that has the most recent in

Based on columns 3 and 7, of the row titled 200 Returns average 10% or so, on average, annua 10.36% annual return on average, and over an

COLUMN 3

http://www.istockanalyst.com/article/viewarticle/articleid/2803347

re or less 45 years of age, with about 20 years until retirement. You can change this in the adjacent spreadsheet, titled 'Your Case'.

currency, it will adjust the other currency cells automatically. USD stands for U.S. dollar, it is the official code used by FX dealers.

ery year. Assumes reinvestment of interest every year, also at 10%: This is compounding interest, or reinvesting interest earned.

ntil age 65, for twenty years, and so assumes you will retire at age 65 and would like a lump sum to live off during retirement.

slightly more than two hundred thousand dollars.

186, over one hundred thirty thousand dollars available to pay for living expenses during retirement, which you can draw every month

expenses from the age of 65, until you die. ng 30 thousand dollars, at 10% annual interest on that capital, the initial amount invested of $30,000 dollars, thirty thousand dollars. ightly more than 200.000 dollars

duced by income taxes, which you can adjust), you can then use $131,186 dollars to live off, for living expenses, after age 65.

4 dollars ($131,186 dollars / 30 years) / (12 months per year), dollars) of monthly disposable income to pay for living expenses.

6 dollars ($131,186 dollars / 20 years) / (12 months per year), dollars) of monthly disposable income to pay for living expenses.

n adjust to your case in the adjacent spreadsheet. You can see what your lump sum amounts to, after 20 years, in your case.

years well invested, in something like a passive index fund such as the S&P 500, Nasdaq, or Dow Jones, money grows well.

company today, at age 45, and see what they can offer based on your savings of thirty thousand dollars today:

s the lump sum or annuity they can offer, net of taxes, at age 65, and between the ages of 65 and the age you will die.

mpany such as Fidelity Investments or Vanguard to invest your money in an index fund (such as Nasdaq or Dow Jones or S&P 500)

und has achieved over 10 years, minimum 5 years, comparing it to the insurance company alternative. The rate should be 10% or so.

ant to take into account these two columns, a twenty year average of annual returns, and an average annual return since 1968, to 2007, at the row titled 2007, the one that has the most recent information on average annual returns of the S&P 500.

Based on columns 3 and 7, of the row titled 2007, the last year of information for annual returns of the S&P 500: Returns average 10% or so, on average, annually, when you look at a ten year recent period, 2004, 2005, 2006, and 2007. 10.36% annual return on average, and over an average period of 20 years, the S&P 500 returns 11.81% annually.

COLUMN 3

COLUMN 7

acent spreadsheet, titled 'Your Case'.

e official code used by FX dealers.

est, or reinvesting interest earned.

m to live off during retirement.

ment, which you can draw every month

0,000 dollars, thirty thousand dollars.

living expenses, after age 65.

ome to pay for living expenses.

ome to pay for living expenses.

to, after 20 years, in your case.

ow Jones, money grows well.

nd the age you will die.

s Nasdaq or Dow Jones or S&P 500)

ernative. The rate should be 10% or so.

nual return since 1968, to 2007,

2004, 2005, 2006, and 2007.

BASIC EXPLANATION OF A RETIREMENT PLAN WITH A RETIREMENT CALCUL

Initial Amount Invested

80,000 10% 20 538,200 349,830

Annual Rate of Return(%) Years Invested

Final Amount at Retirement

Net of Taxes (35%)

Income Tax Rate

What can you do with the money at age 65

Explanations and Suggestions for approaching Retirement Money

Based on common sense, where you can Invest your 30,000 dollars saved, as a basic, 10 year, or 20 year investment alternative: In an S&P 500 Index Fund. See S&P 500 Historical Returns in Table below. This is also called passive investment because you simply follow you choose a reliable an index, you dont choose a particular money manager, mutual fund company that offers an index fund.

Source of Table: Historical Annual Returns For The S&P 500 Index. X

website link to table in september 2012: http://www.istockanalyst.com/article/viewarticle/articleid/2

NT PLAN WITH A RETIREMENT CALCULATOR

Youve saved 30,000 dollars today, and youre more or less 45 years of age, with about 20 years until r
USD

You can change the currency here, to your countrys currency, it will adjust the other currency cells automa

Annual percentage of amount invested generated every year. Assumes reinvestment of interest every yea

Assumes you start saving for retirement at age 45, until age 65, for twenty years, and so assumes you will
USD

At age 65, you have a lump sum of $201,825 dollars, slightly more than two hundred thousand dollars.

USD

Net of taxes, the lump sum at age 65 becomes $131,186, over one hundred thirty thousand dollars availab from your banks checking or savings account.

This amount is a lump sum, not an annuity, for living expenses from the age of 65, until you die. It is a lump sum accumulated over 20 years of investing 30 thousand dollars, at 10% annual interest on tha After 20 years, you reach the lump sum of 201.825, slightly more than 200.000 dollars

Net of Income Taxes (Final Amount at Retirement reduced by income taxes, which you can adjust), you ca

Assuming youll die at age 95, this means about $364 dollars ($131,186 dollars / 30 years) / (12 months pe

Assuming youll die at age 85, this means about $546 dollars ($131,186 dollars / 20 years) / (12 months pe

Numbers are meant to be somewhat average, you can adjust to your case in the adjacent spreadsheet. Y

This shows the power of compound interest, over 20 years well invested, in something like a passive index

With these numbers, you can approach an insurance company today, at age 45, and see what they can of

alled passive investment

If you bring to them 30 thousand dollars today, what is the lump sum or annuity they can offer, net of taxes

icular money manager,

The other alternative is to approach a mutual fund company such as Fidelity Investments or Vanguard to in

for 20 years, seeing what historical rate of return the fund has achieved over 10 years, minimum 5 years, c

rns For The S&P 500 Index. X

Youd want to take into account these two columns, a twenty year and look at the row titled 2007, the one that has the most recent in

Based on columns 3 and 7, of the row titled 200 Returns average 10% or so, on average, annua 10.36% annual return on average, and over an

COLUMN 3

http://www.istockanalyst.com/article/viewarticle/articleid/2803347

re or less 45 years of age, with about 20 years until retirement. You can change this in the adjacent spreadsheet, titled 'Your Case'.

currency, it will adjust the other currency cells automatically. USD stands for U.S. dollar, it is the official code used by FX dealers.

ery year. Assumes reinvestment of interest every year, also at 10%: This is compounding interest, or reinvesting interest earned.

ntil age 65, for twenty years, and so assumes you will retire at age 65 and would like a lump sum to live off during retirement.

slightly more than two hundred thousand dollars.

186, over one hundred thirty thousand dollars available to pay for living expenses during retirement, which you can draw every month

expenses from the age of 65, until you die. ng 30 thousand dollars, at 10% annual interest on that capital, the initial amount invested of $30,000 dollars, thirty thousand dollars. ightly more than 200.000 dollars

duced by income taxes, which you can adjust), you can then use $131,186 dollars to live off, for living expenses, after age 65.

4 dollars ($131,186 dollars / 30 years) / (12 months per year), dollars) of monthly disposable income to pay for living expenses.

6 dollars ($131,186 dollars / 20 years) / (12 months per year), dollars) of monthly disposable income to pay for living expenses.

n adjust to your case in the adjacent spreadsheet. You can see what your lump sum amounts to, after 20 years, in your case.

years well invested, in something like a passive index fund such as the S&P 500, Nasdaq, or Dow Jones, money grows well.

company today, at age 45, and see what they can offer based on your savings of thirty thousand dollars today:

s the lump sum or annuity they can offer, net of taxes, at age 65, and between the ages of 65 and the age you will die.

mpany such as Fidelity Investments or Vanguard to invest your money in an index fund (such as Nasdaq or Dow Jones or S&P 500)

und has achieved over 10 years, minimum 5 years, comparing it to the insurance company alternative. The rate should be 10% or so.

ant to take into account these two columns, a twenty year average of annual returns, and an average annual return since 1968, to 2007, at the row titled 2007, the one that has the most recent information on average annual returns of the S&P 500.

Based on columns 3 and 7, of the row titled 2007, the last year of information for annual returns of the S&P 500: Returns average 10% or so, on average, annually, when you look at a ten year recent period, 2004, 2005, 2006, and 2007. 10.36% annual return on average, and over an average period of 20 years, the S&P 500 returns 11.81% annually.

COLUMN 3

COLUMN 7

acent spreadsheet, titled 'Your Case'.

e official code used by FX dealers.

est, or reinvesting interest earned.

m to live off during retirement.

ment, which you can draw every month

0,000 dollars, thirty thousand dollars.

living expenses, after age 65.

ome to pay for living expenses.

ome to pay for living expenses.

to, after 20 years, in your case.

ow Jones, money grows well.

nd the age you will die.

s Nasdaq or Dow Jones or S&P 500)

ernative. The rate should be 10% or so.

nual return since 1968, to 2007,

2004, 2005, 2006, and 2007.