- Definitions
Current age
- Your current age.
- Age of retirement
- Age you wish to retire. This calculator
assumes that the year you retire you do not make any contributions to
your retirement savings. So if you retire at age 65, your last
contribution happened when you were actually age age 64.
- Annual contribution
- The amount you will contribute to your
retirement savings each year. This calculator assumes that you make
your contribution at the beginning of each year.
- Current tax rate
- Your current marginal tax rate you expect to
pay on your taxable investments.
- Retirement tax rate
- The marginal tax rate you expect to pay on
your investments at retirement.
- Is this savings tax deferred?
- Check this box if you retirement savings is
being deposited into a tax deferred account. This includes an IRA,
401(k), Variable Annuity or other tax deferred investment.
- Increase annual contribution?
- Check this box if wish to have your annual
contribution increased each year to keep up with inflation.
Investment rate of return
- Rate of return on investments. This is the
return that you would make if you were to invest your down payment or
security deposit instead of using it in your auto purchase or lease.
The actual rate of return is largely
dependant on the type of investments you select. From January 1970 to
December 2004, the average compounded rate of return for the S&P
500, including reinvestment of dividends, was approximately 11.5% per
year. During this period, the highest 12-month return was 64%, and the
lowest was -39%. Savings accounts at a bank pay as little as 1% or
less. It is important to remember that future rates of return can't be
predicted with certainty and that investments that pay higher rates of
return are subject to higher risk and volatility. The actual rate of
return on investments can vary widely over time, especially for
long-term investments. This includes the potential loss of principal
on your investment.
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