If you've been keeping up with your reading on Finding North the past ouple of weeks, then certainly you've noticed that I'm a big fan of saving. My friends know this and the other day one of them asked, "how much should I start saving every month?" My answer was, "anything!" I wasn't joking either. People worry about the interest rate on their investments, when they don't even have anything in their investment at all.
That said, for those of you who are curious, I took the liberty of adding the basic compound interest calculator below so anyone interested can see how saving even a little bit each month can really add up over time.
Hint: If you don't know what to put for Interest Rate, then try this. If you're saving for something within the next 5 years use an interest rate of about 2% or 3%. For goals ranging 5-12 years in the future, use a 5% or 6% interest rate, and for anything over 12 years, you can try 7% to 8%. That will give you a fairly safe, conservative estimate.
That said, for those of you who are curious, I took the liberty of adding the basic compound interest calculator below so anyone interested can see how saving even a little bit each month can really add up over time.
Hint: If you don't know what to put for Interest Rate, then try this. If you're saving for something within the next 5 years use an interest rate of about 2% or 3%. For goals ranging 5-12 years in the future, use a 5% or 6% interest rate, and for anything over 12 years, you can try 7% to 8%. That will give you a fairly safe, conservative estimate.
Compound Interest Calculator
| Initial Investment | |
| Regular Investment | |
| Interest Rate | |
| Years | |
| Compounded | |
| Calculate | |
| Powered by CalculateStuff.com | |
RSS Feed