Saving for the Future with Free Calculators.
Take the Money Smart Quiz for Saving
I am the designer of Financial Mappers and the author of Map Your Finances. Today I am going to present the first of four opportunities for you to understand how you can manage your money better. I want everyone to be Money Smart when it comes to their money.
Here’s my Money Smart Quiz
(You can find the answers at the end of this article)
- 85% of people say they need a Financial Plan. How many people actually have made a plan?
- What percentage of people earning over $200,000 a year live payday to payday?
- If you earn 10% after tax and inflation, how many years will it take to double your money?
- If you save $5,000 a year for 40 years, with a net investment return of 4% at the end of 40 years you will have contributed $200,000 and the value of the funds will be $484,600. If you save $20,000 a year for the last 10-years of your working life, you will have contributed the same $200,000. With the same investment return, how much less (percentage) will you have? (Assumptions: 0% Inflation, 0% Tax Rate)
- Who made this famous quote: “The most powerful force in the universe was Compound Interest?”
How MoneySmart were you?
Did you get all five right?
Did the answers surprise you?
Let’s now look at each of these answers and see if I can show you how to be financially secure with the least effort:
Only 20% of people have a Financial Plan
I believe that financial advice should be affordable and accessible for all.
The statistics show that 85% of people say they need a Financial Plan, but only 20% have one. I think the problem is that when people are starting out in their working life, they simply don’t have the funds to warrant paying a financial adviser to draw up a long-term plan.
Until now there has been no way for someone to work out the simple basics, like how much they should save and how much they will have at the end of their working life.
Today I am going to solve that problem for you because you can now sign up to get my Free Calculator which will allow you to make Four Simple Savings Plans and compare the results. Now you can choose the best savings plan for you.
20% of people earning over $200,000 a year live payday to payday.
Did you know that 80% of the general population live payday to payday? We tend to think that “rich people” don’t have that problem. However, statistics show that 20% of people on high incomes have the same financial problem as most people.
It is hard to imagine that so many people have so few financial resources. Are you one of these people? Ask yourself how you would pay for:
- An unexpected car repair of $1,000.
- A medical emergency which required $5,000 for extra fees.
Most people appear to simply add these unexpected costs to their credit card and then struggle for years to repay the debt with very high interest costs.
In my videos, I am going to take you through the process of managing your money. I want to give you the skills to be MoneySmart. I will show you how you can quickly create an Emergency Fund so that you no longer have to rely on credit card debt.
Simply sign up for my videos and you will also receive a set of free calculators to get you started.
It will take 7-years to double your money if you earn 10% after tax and inflation.
Of course, in times of high taxation, earning 10% after tax and inflation is difficult. However, it is not unusual to see many of the growth trusts showing returns of 12% to 18% over the periods of high growth.
If you can earn just 6% after tax and inflation, you will double your money every 12 years. If you had $100,000 invested at age 40, your investment would be:
- $200,000 by age 52
- $400,000 by age 64.
In 24 years you will have quadrupled your money without saving one single dollar. This is the real power of investing and saving early in your life.
Did you know that if you saved $50 a week from age 20, you would have that $100,000? That $100,000 could be $400,000 without saving another dollar.
With my free Savings Calculator, you can work out exactly how much you should save over a 40-year period so that you will have the financial freedom you desire.
You will have 50% less in Retirement if you leave your savings program for the last 10-years of your working life.
The single most important thing you can do is to start a Savings Plan NOW!
Every day you put off saving, the less you will have in retirement. In my videos, I will give you some ideas on how to save that little extra.
It is time to face this problem. It is time to take action. I want you to sit down and work out how you could save an extra $50 a week. Here are a few tips.
- Take a cut lunch to work.
- Reduce the number of takeaway meals
- Buy second hand
- Write a shopping list for groceries
- Plan your wardrobe purchases
If you have a great idea for finding that extra cash please share by leaving your tips in the comments below.
Albert Einstein was one of the most brilliant minds of the 20th Century. Most would associate Albert Einstein with his Theory of Relativity, and other scientific facts, not finance. He was a man with a social conscious and often made public statements relating to money management.
Today I would like to leave you with just one more of his famous finance quotes.
Compound Interest is the eighth wonder of the wonder of the world. He who understands it, earns it… he who doesn’t …pays it.
Now I am here to open your eyes to this “Eighth Wonder of the World”. Today I am giving you a free calculator so you can start to understand how compounding interest works. With this calculator, you can set your Financial Targets for both Income and Value of Investments. You can then explore how much you should save and how the values will change depending on the:
- Investment Return
- Inflation Rate
- Average Tax Rate
- Length of Savings Period.
In addition, I will give you three 30-minute videos to help you get started in managing your money. I will take you through some of the lessons I learned over my 40-years of investment. I will share with you some of the chapters of my book, Map Your Finances, and I will demonstrate how easy it is to make a Financial Plan using Financial Mappers.
(Click on the image to register)
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Answers to Quiz
- 7 years
- $244,900 (50% of the person who saved for 40 years)
- Albert Einstein
Disclaimer: Financial Mappers does not have an Australian Financial Services License, does not offer financial planning advice and does not recommend financial products.