Question for Math/Finance guys
 

I want to invest X dollars every year for Y years at G% annual growth with I% expected inflation to end up with T dollars (in today's terms) at the end of the investment period.

What equation do I use?

DOLA:

Crap, nevermind, not what I thought it was...

http://personal.fidelity.com/toolbox...h/growth.shtml

This sort of gets you what you want. However, you might have to trial and error. There is no option for "I want to have X Dollars at the end"... you set the Initial balance, years, interest rate, inflation rate, and annual investment.

edit - never mind, misread the question.

I think you can get by with:

Value you want = X + X(1+i)^1 + X(1+i)^2 + X(1+i)^3 .... + X(1+i)^y.

To account for inflation, take your anticipated growth (G) minus the expected rate of inflation (1%) to come up with your true growth (i).

Dola:

The equation used in the link Wade posted is probably more accurate. It's basically:

X*Z * [Z^0+Z^1+Z^2+...Z^n-1]

Where X = payments
Z = (1+G)/(1+i) => G = growth %, i = inflation %
n = number of years

Note: this assumes you invest at the beginning of the year, and neglects the time value of money other than inflation.

For more help, search for the term "simple annuity" and beware of the use of negative numbers in the correct places (payments/contributions).

So, what is the answer ? What is X ? Tell me, tell me !

If you're looking for a calculator online to do this for you:

http://www.fool.com/calcs/calculator...urce=LN#saving


How much will my savings be worth is a good one.

How much will it take to save for a vehicle, home, etc lets you put in an end goal.


If you actually want the mathematical equation behind it... i'm not that smart anymore :(