Let’s use a Cash Flow Calculator from www.truthconcepts.com to tell the whole truth about what happens to an account when it gets taxed. We’ll put in $20 in 1913, the year the tax system started. We’ll show the account earning 20% per year. We can see below that the account has $798,784,476 (that’s $798 million) in it. This assumes no taxes or management fees were taken out during this time. If we adjusted the account for inflation, assuming a 4% annual rate, it would have $18,502,442 ($18 million) in

Read More# Category: Prosperity Economics

## How to Calculate the Lost Opportunity Cost of the Typical way to Educate Kids.

How to Calculate the Lost Opportunity Cost of the Typical way to Educate Kids. A college education that cost $30,000 per year in today’s dollars with a 6% inflation for a 4 and a 6 year old will remove $2,187,493 from the parents wealth by the time they are 68 years old. How? The actual cost of the school plus the opportunity cost of the money removed from the parents’ estate assuming it was earning 5%. We’ll use a Cash Flow Calculator from www.truthconcepts.com to tell you the whole truth

Read More## How To Get One Dollar To Do Many Jobs

First let’s define what a job is. Any time a dollar buys an asset, pays an insurance premium, reduces tax, increases cash flow, leverages itself, improves protection, recaptures opportunity cost, improves liquidity, recovers control, enables tax benefits, builds confidence, gains movement or lowers restrictions, that dollar is doing one job. And in many products it can do 2 or 3 (products are things you buy). In many strategies it can do 5 or 6 additional (strategies are things you do.) So many people limit their prosperity potential by having

Read More## Calculating Internal Rate of Return

How do you calculate the internal rate of return on an investment when the cash flows vary and you can’t use a typical financial calculator that only functions with the same stream of payments, not a varying stream? For example, you invest in an oil well where you contribute $100,000 the first year and the second year there is a $20,000 capital call (meaning you contribute $20,000 more). Then in the third year, there wasn’t any income but starting in the fourth year, you received the following stream, $30,000, $25,000,

Read More## How To Figure Out If 12% Annually Is The Same As 1% Monthly?

How do you figure out if 12% annually is the same as 1% monthly? First take a Future Value Calculator on “annual” and put in $100,000 at 12% for 1 year, and it shows the FV to be $112,000. Then take another Future Value Calculator set on “monthly” and put in $100,000 at 12% for 12 months, and it shows the FV to be $112,683. Most banks compound monthly, a few savings and loans compound quarterly, yet it is common to express interest rates

Read More## How Much Interest Do I Save By Paying My Life Insurance Premium Annually?

How do you calculate the cost of paying a life insurance premium monthly instead of annually? Get a Rate Calculator from www.truthconcepts.com. Put the annual premium in the Present Value as a negative number (which changes it to Loan Balance) since the insurance company is loaning you the annual premium and you pay them back monthly. Then make the mode “monthly” and “beg” for beginning of year since the insurance company loans you money at the beginning of the period. Put the monthly premium payment in Monthly Payment box and

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