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Financial Calculators. ILX Lightwave May 14, 2003. Marsha A. Goetting Ph.D., CFP ® , CFCS. Professor & Extension Family Economics Specialist Department of Agricultural Economics & Economics. How many of you have used a financial calculator?????.

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Financial calculators l.jpg

Financial Calculators

ILX Lightwave

May 14, 2003


Marsha a goetting ph d cfp cfcs l.jpg

Marsha A. Goetting Ph.D., CFP®, CFCS

Professor & Extension Family Economics Specialist

Department of Agricultural Economics & Economics


How many of you have used a financial calculator l.jpg
How many of you have used a financial calculator?????



Purpose experience how financial calculator can help you make deci ion about your finances l.jpg
PurposeExperience How Financial Calculator Can Help You Make Deci$ion$ About Your Finances








Financial calculator l.jpg
Financial Calculator

  • Texas Instruments BA-35 Solar Business Analyst

  • Cost about $20 at most discount stores


Introduction l.jpg
Introduction

  • Getting Acquainted with your Financial Calculator


Turn on l.jpg
Turn on

CE/C

Fix

MODE

AC/ON

2nd

CPT

x 12

¸ 12

PV

PMT

N

% i

FV


Financial mode l.jpg
Financial Mode

  • If FIN is not lower left corner

  • Press

CPT

AC/ON

MODE

Fin 0.


Decimal function l.jpg
Decimal Function

Fix

  • Press

2nd

CPT

2

FIN 0.00

2nd


Clearing screen display l.jpg
Clearing Screen/Display

  • Press key once

  • Clears Display

  • Corrects Incorrect Entries

  • Clears word “Error”

CE/C


Clearing financial registers l.jpg
Clearing Financial Registers

CMR

  • Press key

  • Clears numbers in registers & display

2nd

CE/C

CE/C

N

%i

PV

PMT

FV


Finance keys l.jpg
Finance Keys

N

Number of Periods

Interest Rate

Payment Amount

% i

PMT


Finance keys20 l.jpg
Finance Keys

PV

Present Value

Future Value

Compute key

FV

CPT



Finance key l.jpg
Finance Key

PV

Present Value

Value of the $avings you have today



Future value 10 000 l.jpg
Future Value $10,000

  • Clear registers 2nd CE/C CE/C

  • Enter PV 10,000 PV

  • Enter # Periods 20 N

  • Enter % Rate 3 %i

  • CPT FV18,061.11


Future value 15 000 l.jpg
Future Value $15,000

  • Clear registers 2nd CE/C CE/C

  • Enter PV 15,000 PV

  • Enter # Periods 5 N

  • Enter % Rate 6.25 %i

  • CPT FV 20,311.22


Future value 50 000 l.jpg
Future Value $50,000

  • Clear registers 2nd CE/C CE/C

  • Enter PV 50,000 PV

  • Enter # Periods 40 N

  • Enter % Rate 5 %i

  • CPT FV351,999.44wait


What if l.jpg
What if ?????

  • You want to know what the amount will grow to in 15 years instead of 40….just change the

N


Future value 15 years l.jpg
Future Value 15 years

  • Clear registers 2nd CE/C CE/C

  • Enter PV 50,000 PV

  • Enter # Periods15 N

  • Enter % Rate 5 %i

  • CPT FV 103,946.41


The difference l.jpg
The difference

  • 40 yrs = $351,999.43

  • 15 yrs = $103,946.41

$248,053.02



Solving for future value of annual regular deposits l.jpg

Solving for Future Value of AnnualRegular Deposits



Payments deposits l.jpg
Payments (Deposits)

  • Enter deposit amount as a negative value

  • 2,000

  • Screen: -2,000.00

+/-

PMT


Ira single person l.jpg
IRA(single person)

  • $2,000 per year for 26 years

  • What amount will be in his IRA?


Ira single person35 l.jpg
IRA(single person)

  • Clear registers 2nd CE/C CE/C

  • Enter PMT2,000 +/- PMT

  • Enter # Periods 26 N

  • Enter % Rate 5 %i

  • CPT FV 102,226.91


Ira married couple l.jpg
IRA(married couple)

  • $2,000 each per year for 25 years

  • What amount will be in their IRAs?


Ira married couple37 l.jpg
IRA--Married Couple

  • Clear registers 2nd CE/C CE/C

  • Enter PMT4,000 +/- PMT

  • Enter # Periods 25 N

  • Enter % Rate 11 %i

  • CPT FV457,653.23(hold)


What if38 l.jpg
What if ?????

  • Interest rate is only 4% instead of 11%….just change the amount in

% i


Ira married 4 l.jpg
IRA--Married 4%

  • Clear registers 2nd CE/C CE/C

  • Enter PMT4,000 +/- PMT

  • Enter # Periods 25 N

  • Enter % Rate 4 %i

  • CPT FV 166,583.63


The difference40 l.jpg
The difference

  • 11% = $457,653.23

  • 4% = $166,583.63

$291,069.63


Roth ira l.jpg
Roth IRA

  • After-tax dollars

  • Accumulations can be withdrawn tax-free if:

    • age 59 1/2

    • held for 5 years


Roth ira42 l.jpg
Roth IRA

  • $3,000 per year for 40 years

  • What amount will be in the Roth IRA?


Roth ira43 l.jpg
Roth IRA

  • Clear registers 2nd CE/C CE/C

  • Enter PMT3,000 +/- PMT

  • Enter # Periods 40 N

  • Enter % Rate 5 %i

  • CPT FV $362,399.32


Roth ira44 l.jpg
Roth IRA

  • $3,000 per year for 20 years.

  • What amount will be in the Roth IRA?


Roth ira45 l.jpg
Roth IRA

  • Clear registers 2nd CE/C CE/C

  • Enter PMT3,000 +/- PMT

  • Enter # Periods 20 N

  • Enter % Rate 6 %i

  • CPT FV $110,356.77



New problem l.jpg
New Problem:

  • How much will we have in the future if we add annually to our present savings?



Annual deposits with beginning balance 10 000 l.jpg
Annual Deposits with Beginning Balance$10,000

  • Clear registers 2nd CE/C CE/C

  • Enter PV (Beg. Bal.) 10,000 PV

  • Enter PMT 2,000 +/- PMT

  • Enter % Rate 5 %i

  • Enter # Periods 7 N

  • CPT FV 30,355.02 (hold)


What if50 l.jpg
What if ?????

  • Interest rate is only 3% instead of 5%

  • Just change the interest rate

% i


Annual deposits with beginning balance 10 00051 l.jpg
Annual Deposits with Beginning Balance$10,000

  • Clear registers 2nd CE/C CE/C

  • Enter PV (Beg. Bal.) 10,000 PV

  • Enter PMT 2,000 +/- PMT

  • Enter % Rate 3 %i

  • Enter # Periods 7 N

  • CPT FV 27,623.66


Difference rate l.jpg
Difference % rate

  • 5% = $30,355.02

  • 3% = $27,623.66

$2,731.36


Education fund 1 000 add annually 2 500 l.jpg
Education Fund--$1,000 Add annually $2,500

  • Clear registers 2nd CE/C CE/C

  • Enter PV (Beg. Bal.) 1,000 PV

  • Enter PMT 2,500 +/- PMT

  • Enter % Rate 6.5 %i

  • Enter # Periods 18 N

  • CPT FV 84,131.82


Retirement fund 15 000 add annually 1 200 l.jpg
Retirement Fund--$15,000 Add annually $1,200

  • Clear registers 2nd CE/C CE/C

  • Enter PV (Beg. Bal.) 15,000 PV

  • Enter PMT 1,200 +/- PMT

  • Enter % Rate 8.5 %i

  • Enter # Periods 25 N

  • CPT FV 209,702.79



Monthly savings l.jpg
Monthly Savings Balance & Add Annually


Convert 2 items l.jpg
Convert 2 items Balance & Add Annually

  • Interest Rate

  • # of Periods

% i

N


Annual interest rate l.jpg
Annual Interest Rate Balance & Add Annually

  • 18.5 % Annual Percentage Rate

  • Convert to monthly


Monthly interest rate l.jpg
Monthly Interest Rate Balance & Add Annually

  • Divide interest rate by 12

    • 18.5 ¸ 12 =1.54

    • Then press

%i


Of periods monthly l.jpg
# of Periods- Balance & Add AnnuallyMonthly

  • Multiply number of years by 12

  • 6 yearsx 12 = 72

  • Then press

N


Grandparents l.jpg
Grandparents Balance & Add Annually

  • Save $5 each month for 18 years


5 per month l.jpg
$5 per month Balance & Add Annually

  • Clear registers 2nd CE/C CE/C

  • Enter PMT5 +/- PMT

  • # Periods18 x 12 = 216 N

  • % Rate5.5 ¸ 12 = 0.46 %i

  • CPT FV 1,838.35


Aunts uncles 60 l.jpg
Aunts & Uncles $60 Balance & Add Annually


60 per month l.jpg
$60 per month Balance & Add Annually

  • Clear registers 2nd CE/C CE/C

  • Enter PMT60 +/- PMT

  • # Periods18 x 12 = 216 N

  • % Rate6.5 ¸ 12 = 0.54 %i

  • CPT FV 24,500.33


Save 100 l.jpg
Save $100 Balance & Add Annually

  • Each month for 30 years


100 each month l.jpg
$100 each month Balance & Add Annually

  • Clear registers 2nd CE/C CE/C

  • Enter PMT100 +/- PMT

  • # Periods 30 x 12 = 360 N

  • % Rate5.5¸12 = 0.46 %i

  • CPT FV 91,361.19


Saving for down payment l.jpg
Saving for down payment Balance & Add Annually


Monthly savings68 l.jpg
Monthly Savings Balance & Add Annually

  • Clear registers 2nd CE/C CE/C

  • Enter PMT600 +/- PMT

  • # Periods 5 x 12 = 60 N

  • % Rate9.5 ¸ 12 = 0.79 %i

  • CPT FV 45,853.35


Add to retirement fund monthly l.jpg
Add to Retirement Fund Monthly Balance & Add Annually


Retirement fund 15 000 add monthly 100 l.jpg
Retirement Fund Balance & Add Annually--$15,000 Add monthly-- $100

  • Clear registers 2nd CE/C CE/C

  • Enter PV (Beg. Bal.) 15,000 PV

  • Enter PMT 100 +/- PMT

  • % Rate 5 ¸ 12 = 0.42 %i

  • # Periods 25 x 12 = 300 N

  • CPT FV 111,770.33


Future value savings l.jpg
Future Value Savings Balance & Add Annually

  • Lump Sum Savings

  • Annual Savings

  • Monthly Savings

  • Beginning balance & add yearly or monthly


Alternatives l.jpg
Alternatives Balance & Add Annually

Bank

Credit

Union

Savings &

Loan


Which pays more l.jpg
Which pays more? Balance & Add Annually

  • 5.80% compounded quarterly

  • 5.75 % cp monthly

  • 5.50% cp daily


Converting l.jpg
Converting Balance & Add Annually

  • Annual Percentage Rate (APR) to

  • Annual Effective Yield (AEY)


Eff key l.jpg
EFF Key Balance & Add Annually

CE/C

Fix

CPT

MODE

AC/ON

2nd

EFF

2

3

RCL

1


5 8 compounded quarterly l.jpg
5.8 Balance & Add Annuallycompounded quarterly

  • Clear 2nd CE/C CE/C

  • Enter interest rate 5.8

  • Press 2nd EFF

  • Enter # cp 4

  • Press = 5.93

1


5 75 compounded monthly l.jpg
5.75 Balance & Add Annuallycompounded monthly

  • Clear 2nd CE/C CE/C

  • Enter interest rate 5.75

  • Press 2nd EFF

  • Enter # cp 12

  • Press = 5.90

1


5 5 compounded daily l.jpg
5.5 Balance & Add Annuallycompounded daily

  • Clear 2nd CE/C CE/C

  • Enter interest rate 5.5

  • Press 2nd EFF

  • Enter # cp 365

  • Press = 5.65

1


Which account pays most l.jpg
Which account pays most? Balance & Add Annually

  • 5.8 % cp quarterly = 5.93

  • 5.75 % cp monthly = 5.90

  • 5.5 % cp daily = 5.65


Annual deposits with beginning balance 10 00080 l.jpg
Annual Deposits with Beginning Balance Balance & Add Annually$10,000

  • Clear registers 2nd CE/C CE/C

  • Enter PV (Beg. Bal.) 10,000 PV

  • Enter PMT 2,000 +/- PMT

  • Enter % Rate 5.93 %i

  • Enter # Periods 20 N

  • CPT FV104,670.38 (hold)


Annual deposits with beginning balance 10 00081 l.jpg
Annual Deposits with Beginning Balance Balance & Add Annually$10,000

  • Clear registers 2nd CE/C CE/C

  • Enter PV (Beg. Bal.) 10,000 PV

  • Enter PMT 2,000 +/- PMT

  • Enter % Rate 5.65 %i

  • Enter # Periods 20 N

  • CPT FV 100,880.77


Difference 20 yrs l.jpg
Difference 20 yrs Balance & Add Annually

  • 5.93 = $104,670.38

  • 5.65 = $100,880.77

$3,389.61


Credit83 l.jpg
Credit Balance & Add Annually


Credit card l.jpg
Credit Card Balance & Add Annually

  • Average balance

    • $1,825bank credit card

  • 18% APR


Credit card85 l.jpg
Credit Card Balance & Add Annually

  • Pay $28 minimum payment

  • How long to pay off??????


28 monthly payment l.jpg
$28 monthly payment Balance & Add Annually

  • 21 years

  • 16 years

  • 11 years

  • 5 years


Interest paid l.jpg
Interest Paid Balance & Add Annually

  • $5,325

  • $3,460

  • $2,377

  • $ 956


Credit card 1 825 l.jpg
Credit Card Balance & Add Annually$1,825

  • Clear registers 2ndCE/CCE/C

  • Credit balance1,825 PV

  • % Rate18 ¸ 12 = 1.5 %i

  • Payment 28 PMT

  • CPT N 255.38 months

  • ¸ 12 = 21.28 yrs (Don’t clear)


Compute interest paid l.jpg
Compute interest paid Balance & Add Annually

  • Press again:

  • CPT N 255.38

  • # of monthly payments


Interest paid90 l.jpg

255.38 months Balance & Add Annually

x $28 payments

$ 7,150.55 paid back

-$ 1,825.00 loan

Interest Paid


Interest paid91 l.jpg

$5.3255.55 paid in interest over 21.28 years Balance & Add Annually

Interest Paid


Credit cards l.jpg
Credit Cards Balance & Add Annually

  • Donna’s Balance $6,500

  • APR 19%

  • $130 payments


How long to pay off l.jpg
How long to pay off? Balance & Add Annually

  • Clear registers 2nd CE/C CE/C

  • Loan Amount 6,500 PV

  • Payment 130 PMT

  • % Rate19 ¸ 12 = 1.58 %i

  • CPT N (months) 99.85

  • ¸12 = 8.32 years (don’t clear)


Compute interest paid94 l.jpg
Compute interest paid Balance & Add Annually

  • Press again:

  • CPT N 99.85

  • # of monthly payments


Interest paid95 l.jpg

99.85 months Balance & Add Annually

x $130 payments

$ 12,980.86 paid back

- 6,500.00 credit balance

Interest Paid


Interest paid96 l.jpg

$6,480.86 interest paid by Donna over 8.32 yrs. Balance & Add Annually

Interest Paid


Increase payment l.jpg
Increase payment Balance & Add Annually

  • Old payment

    • $130

  • New payment

    • $230


How long to pay off98 l.jpg
How long to pay off? Balance & Add Annually

  • Clear registers 2nd CE/C CE/C

  • Loan Amount 6,500 PV

  • Payment 230 PMT

  • % Rate19 ¸ 12 = 1.58 %i

  • CPT N (months) 37.76

  • ¸12 = 3.15 years


Compute interest paid99 l.jpg
Compute interest paid Balance & Add Annually

  • Press again:

  • CPT N 37.76

  • # of monthly payments


Interest paid100 l.jpg

37.76 months Balance & Add Annually

x $230 payments

$ 8,685.58 paid back

- 6,500.00 credit balance

Interest Paid


Interest paid101 l.jpg

$2, 185.58 interest paid by Donna over 3.15 yrs. Balance & Add Annually

Interest Paid


The difference102 l.jpg
The difference Balance & Add Annually

  • $130 8.32 yrs = $6,490.86

  • $230 3.15 yrs = $2,185.58

$4,305.28


Central idea l.jpg
Central Idea Balance & Add Annually

  • Paying off credit card balance sooner means higher payments, but

    • you pay less INTERE$T


Dream home l.jpg
Dream Home Balance & Add Annually

  • Average price

    • $135,000

  • Down payment

    • $27,000


Payment amount l.jpg
Payment Amount? Balance & Add Annually

  • Finance $108,000

  • APR 9.5%

  • 30 year mortgage


Payment l.jpg
Payment? Balance & Add Annually

  • Clear registers 2nd CE/C CE/C

  • Loan Amount 108,000 PV

  • # Periods30 x 12 = 360 N

  • % Rate 9.5 ¸ 12 = 0.79 %i

  • CPT PMT 908.12


Cheaper home l.jpg
Cheaper Home Balance & Add Annually

  • Finance $66,000

  • APR 13%

  • 30 year mortgage


Payment108 l.jpg
Payment? Balance & Add Annually

  • Clear registers 2nd CE/C CE/C

  • Loan Amount 66,000 PV

  • # Periods 30 x 12 = 360 N

  • % Rate13 ¸ 12 = 1.08 %i

  • CPT PMT 730.09 (hold)


Young professionals l.jpg
Young Professionals Balance & Add Annually

  • What if we pay an extra $100 towards principal each month ?


Extra 100 l.jpg
Extra $100 Balance & Add Annually

  • Clear registers 2nd CE/C CE/C

  • Loan Amount66,000 PV

  • Payment 830.09 PMT

  • % Rate13 ¸ 12 = 1.08 %i

  • Compute months CPT N 183.37

  • ¸12 =15.28 yrs


Comparison l.jpg

$730 Balance & Add Annually

30 yrs

$830

15.28 yrs

Comparison


Payment comparison l.jpg

$ Balance & Add Annually730.09 Monthly

x 360 # payments

$262,833 Paid Back

- $66,000 Loan

$196,833 Interest

$830.09 Monthly

x 183.37 # payments

$152,213 Paid Back

-$66,000 Loan

$86,213 Interest

Payment Comparison

$110,620 saved


Credit examples l.jpg
Credit Examples Balance & Add Annually

  • Payments on Mortgage & Credit Cards

  • Time remaining on loans if increase payments

  • Calculate monthly interest charge


Retirement planning114 l.jpg
Retirement Planning Balance & Add Annually


Retirement decisions l.jpg
Retirement Decisions Balance & Add Annually

  • How much should I save for retirement?


Retirement goal l.jpg
Retirement Goal Balance & Add Annually

  • $500,000

  • By age 65

    • 40 years

  • How much to save monthly?


Goal 500 000 l.jpg
Goal: Balance & Add Annually$500,000

  • Clear registers 2nd CE/C CE/C

  • Enter FV 500,000 FV

  • % Rate8 ¸ 12 =0.67 %i

  • # Periods 40 x 12 = 480 N

  • CPT PMT- 143.23 (don’t clear)



What if119 l.jpg
What if ????? 40 years

  • You already have $18,000 in savings that you have designated for retirement?

  • Now you have

PV


500 000 18 000 l.jpg
$500,000 40 years($18,000)

  • Clear registers 2nd CE/C CE/C Enter FV 500,000 FV

  • Enter PV18,000 PV

  • % Rate 8 ¸ 12 = 0.67 %i

  • # Periods 40 x 12 = 480 N

  • CPT PMT - 18.07 (hold)


Note the minus 18 07 l.jpg

If you save $18.07 every month, you will have $500,000 because you started with $18,000

Note the minus -18.07


What if122 l.jpg
What if ????? because you started with

  • You already have $90,000 in savings that you have designated for retirement?


500 000 90 000 l.jpg
$500,000 because you started with ($90,000)

  • Clear registers 2nd CE/C CE/C

  • Enter FV 500,000 FV

  • Enter PV90,000 PV

  • % Rate 8 ¸ 12 = 0.67 %i

  • # Periods 40 x 12 = 480 N

  • CPT PMT 482.56


Note there is no minus l.jpg

You can start withdrawing $482.46 every month & you will still have $500,000 in 40 years

Note there is no minus


Goal 300 000 l.jpg
Goal: still have $500,000 in 40 years$300,000

  • Retire 20 yrs

  • Has $5,000

  • How much to save monthly?


300 000 5 000 l.jpg
$300,000 still have $500,000 in 40 years($5,000)

  • Clear registers 2nd CE/C CE/C

  • Enter FV 300,000 FV

  • Enter PV 5,000 PV

  • % Rate 8 ¸ 12 = 0.67 %i

  • # Periods 20 x 12 = 240 N

  • CPT PMT - 467.50


Goal 100 000 l.jpg
Goal: still have $500,000 in 40 years$100,000

  • Retire 10 yrs

  • Has $15,000

  • How much to save monthly?


Goal 100 000128 l.jpg
Goal: $100,000 still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Enter FV 100,000 FV

  • Enter PV 15,000 PV

  • % Rate 5 ¸ 12 = 0.42 %i

  • # Periods 10 x 12 = 120 N

  • CPT PMT - 484.89


Retired couple l.jpg
Retired Couple still have $500,000 in 40 years

  • “How much can we take out of our retirement fund monthly if we want it to last 20 years?”


Retirement fund 115 000 l.jpg
Retirement Fund still have $500,000 in 40 years$115,000

  • Clear registers 2nd CE/C CE/C

  • Retirement Fund 115,000 PV

  • # Periods 12 x 20 = 240 N

  • % Rate4 ¸ 12 = 0.33 %i

  • CPT PMT 696.88


Single person l.jpg
Single Person still have $500,000 in 40 years

  • Retirement fund $250,000

  • Last 30 years


250 000 30 yrs l.jpg
$250,000 (30 yrs) still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Retirement Fund 250,000 PV

  • # Periods 12 x 30 = 360 N

  • % Rate 5 ¸ 12 = 0.42 %i

  • CPT PMT 1,342.05


Slide133 l.jpg
IRA still have $500,000 in 40 years

  • $50,000

  • Supplement Social Security for 20 years


50 000 ira l.jpg
$50,000 IRA still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Retirement Fund 50,000 PV

  • # Periods 12 x 20 = 240 N

  • % Rate4 ¸ 12 = 0.33 %i

  • CPT PMT302.99


Retired couple135 l.jpg
Retired Couple still have $500,000 in 40 years

  • “How long will our retirement fund ($100,000) last if we take out $1,200 monthly?”


100 000 fund l.jpg
$100,000 fund still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Retirement Fund 100,000 PV

  • Payment 1,200 PMT

  • % Rate 4 ¸12 = 0.33 %i

  • Compute months CPT N 97.79

  • ¸ 12 = 8.15 yrs (don’t clear)


100 000 fund137 l.jpg
$100,000 fund still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Retirement Fund 100,000 PV

  • Payment 900 PMT

  • % Rate 4 ¸12 = 0.33 %i

  • Compute months CPT N 139.02

  • ¸ 12 = 11.58 (don’t clear)


100 000 fund138 l.jpg
$100,000 fund still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Retirement Fund 100,000 PV

  • Payment 650 PMT

  • % Rate 4 ¸12 = 0.33 %i

  • Compute months CPT N 216.10

  • ¸ 12 = 18.01 years


The difference139 l.jpg
The difference still have $500,000 in 40 years

  • $1,200 monthly = 8.15 yrs

  • $ 900 monthly = 11.58 yrs

  • $ 650 monthly = 18.01 yrs


Retirement planning140 l.jpg
Retirement Planning still have $500,000 in 40 years

  • Summary


Retirement l.jpg
Retirement still have $500,000 in 40 years

  • Amount to save monthly to achieve retirement goals


Retirement142 l.jpg
Retirement still have $500,000 in 40 years

  • Amount to take out monthly during retirement based on life expectancy


Retirement143 l.jpg
Retirement still have $500,000 in 40 years

  • How long retirement fund will last if take out specific amount monthly


Inflation l.jpg
Inflation still have $500,000 in 40 years

1999 2.2%


Inflation145 l.jpg
Inflation still have $500,000 in 40 years

  • If I need $1,500 per month now …. how much will I need in 25 years????


Inflation146 l.jpg
INFLATION still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Enter PV 1,500 PV

  • Enter # Periods 25 N

  • Enter % Rate 6.3 %i

  • CPT FV6,909.12 (hold)


What if147 l.jpg
What if ????? still have $500,000 in 40 years

  • Inflation is only 4.2% instead of 6.3%.….just change the inflation rate key

% i


Inflation example l.jpg
INFLATION EXAMPLE still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Enter PV 1,500 PV

  • Enter # Periods 25 N

  • Enter % Rate 4.2 %i

  • CPT FV 4,195.50


Difference 15 yrs l.jpg
Difference 15 yrs still have $500,000 in 40 years

  • 6.3% = $6,909.12

  • 4.2% = $4,195.50

$2,713.62


Inflation150 l.jpg
Inflation still have $500,000 in 40 years

  • If we need $2,000 per month now …. how much will we need in 15 years?


Inflation example151 l.jpg
INFLATION EXAMPLE still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Enter PV 2,000 PV

  • Enter # Periods 15 N

  • Enter % Rate 4 %i

  • CPT FV3,601.89


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Inflation still have $500,000 in 40 years

  • If I need $2,500 per month now …. how much will I need in 25 years?


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INFLATION EXAMPLE still have $500,000 in 40 years

  • Clear registers 2nd CE/C CE/C

  • Enter PV 2,500 PV

  • Enter # Periods 25 N

  • Enter % Rate 4.25 %i

  • CPT FV7,076.88


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$$$$$$$$$$$$ still have $500,000 in 40 yearsHow a Financial Calculator Can Help You Make Deci$ion$


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Marsha A. Goetting still have $500,000 in 40 yearsPh.D., CFP®, CFCS

Professor & Extension Family Economics Specialist

Department of Agricultural Economics & Economics


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