1. How accurate are these calculations?
Our calculators use standard financial formulas to provide projections based on your inputs. While we can't predict future market conditions, the calculations show what would happen if your money grew at a consistent rate over time.
2. Should I use before-tax or after-tax amounts?
For retirement accounts like 401(k)s or IRAs, use before-tax amounts. For taxable accounts, you might want to use after-tax amounts and adjust your expected return downward to account for taxes on gains.
3. How often should I recalculate my projections?
We recommend reviewing your projections annually or whenever your financial situation changes significantly (raise, bonus, market shifts, etc.). Regular check-ins help keep your plan on track.
4. What inflation rate should I use?
Historically, inflation averages about 3% annually. For conservative planning, you might use 3-3.5%. During high inflation periods, you may want to use a higher rate for near-term projections.
5. Can I save my calculations?
Currently, results aren't saved automatically. We recommend taking screenshots or noting down important numbers. Future updates may include save/load functionality.
6. How does compound interest work in these calculations?
We assume interest compounds annually, meaning each year's earnings generate their own earnings in subsequent years. This creates exponential growth over time, which is why starting early is so powerful.
7. What's the difference between APR and APY?
APR (Annual Percentage Rate) doesn't account for compounding, while APY (Annual Percentage Yield) does. Our calculators use APY-equivalent rates to show the true growth potential of your investments.
8. Can I calculate irregular contributions?
Our current version assumes regular contributions. For irregular patterns, you might calculate different periods separately or use an average monthly contribution.
9. Why are my actual investment returns different?
Markets fluctuate daily. Actual returns will vary from projections. That's why it's wise to use conservative estimates and review your plan regularly.
10. Is this tool free to use?
Yes! SteynorPek's financial calculators are completely free with no registration required. We believe everyone should have access to quality financial planning tools.