NCFCU - Calculators - Taxed and Non-taxed Compounding Calculator

Taxed and Non-taxed Compounding Calculator

This calculator shows you how much money you can make by leaving a sum of money in an account at a certain interest rate. It helps you to understand the difference that tax-sheltered compounding can make, and also shows you the effect of inflation.

Enter the amount of money that you wish to deposit initially, the expected interest rate, and the expected inflation rate. The calculator will show you the amount that will accumulate in the account over different time spans both with and without taxes. It will also show you how much money that initial amount will buy in the future because of inflation -- that way, you can see if an investment actually grows.

Amount to deposit Enter the amount of money that you will initially deposit in the account.
Interest rate Enter the interest rate. If you wish to use a 5.0% interest rate, enter 5.0. As of March 1, 2002, here are some typical rates: passbook savings account: 1% - 3%; one year CD: 2% - 3%; stock market average return: 10.5%.
Federal and state tax rate Enter the sum of your federal and state tax rates. For example, if you are in the 23% federal tax bracket and your state has a 7% income tax rate, enter 30 here. If you have no idea, use 30.
Inflation rate Enter the expected inflation rate over the period of time. If you have no idea, try 4% (enter 4).
Click this button to calculate the account value.
Year	Value: Tax-free compounding	Value: Taxed compounding	Inflation
After 1 year
After 2 years
After 3 years
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