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| 1. Welcome | 5. Deposits
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| 2. General | 6.
Withdrawals
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3. Loans
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7. Inflation
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4. Investments
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8. Acknowledgements |
Withdrawals determine how long a periodic fixed amount can be taken from an initial lump sum investment at a fixed growth rate before the account is totally depleted, answering the question 'How long will my life-long savings last after I retire?' The parameters for Withdrawals are:
Withdrawals
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$
Value of the Initial Investment
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$
Amount of Regular Withdrawals
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#
of Regular Withdrawals per Year
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Annual
Interest Rate in %;
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#
of Years of Regular Withdrawals
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Example: To calculate the amount that can be withdrawn monthly for 25 years at 6.00% annual interest rate from an initial amount of $1,500,000 ...
1. Click on the (Withdrawals) tab in the top row of tabs in the FinancesOSX window.
2. Click on the (Withdrawal Amounts) tab in the second row of tabs.
3. Enter "1500000" in the {Initial Investment} field, "12" in the {Withdrawals/Yr} field, "6.00" in the {Annual Interest Rate} field, and "25" in the {Number of Years} field. Tabbing is permitted between fields.
4. Click on the [Compute Withdrawal Amts] button. The withdrawal amount of "$ 9,664.52" is then displayed in the {Compute Withdrawal Amounts} field. This answer can be copied to the clipboard.
Go to the Inflation calculation to determine the relative purchasing power of the withdrawal amount at some point in the future due to the eroding effect of inflation. This can help provide perspective on what lifestyle the savings can support over time.
An error message is displayed if the Years of Withdrawals calculation results in the account never reaching a zero balance (e.g., the withdrawal amount is less than the initial interest payment).