Purpose

We discussed investing in various articles: Understanding Investment Types, The Power of Compounding, Age-appropriate Investing, etc. The investment calculator here helps in estimating how to allocate our funds.

We use this to see how our different investments can grow over time. It supports:

• multiple investments;
• fixed income investments (example: rental properties) and variable income investments;
• control how much of an investment can be withdrawn for expenses (including "none of it");
• time periods when an investment is available for withdrawal;
• the order in which investments can be withdrawn from.

Here are a few ways this calculator can be used:

• deciding how to allocate funds;
• learning how investments grow over time. To just see how the investments grow without factoring in expenses, set 'Annual expense' to 0. Similarly, to see the pre-tax investment gains, set 'Annual tax rate' to 0;
• seeing how the gains from investments can be used for expenses;
• creating what-if investment scenarios to understand investment options.

Limitations

• The calculations are approximate, and are mainly meant to give a quick estimate of the various possibilities.
• Taxation is conservative and errs on the side of caution. For example, if an investment is taxable, all withdrawals in a year are considered taxable, even the portion that comes from the principal.

Disclaimer

Use this calculator only as a way to get a feel for how investments can grow. As each person's financial status and needs are different, please discuss with your financial advisor and tax consultant before investing.