Saturday, April 16, 2005

Future Goals

Side note: I have on eBay sale going on right now and this should add to my net worth. Total cost: $55, total estimated sale $125, total profit = $70 which is a 127% gain.

Future Goals

May 2005: $25,000

Current Age: 23

Here is my thinking. I'm assuming my salary is $40,000 and I'm assuming my take-home pay is 80% of this so: $32,000. By month this should be around $2,650. I'm going to assume that rent and other miscellaneous expenses will run about $1500/month. This should leave $1,150/month for investing. Per year this will be $13,800 but I will round up to $14,000.
Assuming 0% growth I will have (starting with an estimated $24,000) about $122,000
I plan to go for a growth target that might be slightly high, 15%.
Based on this growth target, my goal for age 30 will be:
Note: this does not take into account bonuses or raises in salary.

Age 40: I will use the age 30 goal, but now change some of the factors. I will assume that my salary will be higher, but possibly expenses. To take this into account I will change the money left over for investing from $14,000 to $17,000. The growth rate will be changed to 12%.
Goal for age 40:

Age 50: Basically the same thing as age 40. I will up the $17k to $20,000 and change the growth rate to 10%.
Goal for age 50:
about $2,850,000

These are really flexible assumptions, since it's hard to forecast certain expenses and things like that. Right now I'm keeping that $25,000 goal in sight. Once May passes, I will focus on the goal for age 30 and most likely make smaller goals for that time period.


stockdiva said...

Hey, check out this website which has all sorts of great financial calculators that I know you will enjoy. Here’s the link -

Alpha said...

stockdiva, thanks for the link!

that site had some very cool calcuators, and I ended up spending a good amount of time there, thanks again.