Let’s build a spreadsheet that will help you evaluate some very basic retirement issues in short order. Put each of the following in its own cell—kind of a ‘‘control panel’’ approach: (1) Starting yearly salary during (consider at end of)
year 1; (2) increase in salary per year in percent; (3) percentage of your salary that you will invest; (4) growth of investments per year in percent; (5) amount of money you would like to have today if you retired; and (6) rate in percent per year that things cost more to buy. (Note that [6] is what we will call the general inflation rate in Chapter 1.2 ). Now build your spreadsheet with the following columns:
A: Year—from 0 up to about 45.
B: My Age—in year 0, put your age at the time you begin investing, and increase it to about your age plus 45.
C: Desired Amount—In year 0, put the number in cell 5. Increase it each year by the percentage in cell 6.

D: Earnings—In year 0, put the number in cell 1. Increase it each year by the percentage in cell 2 up to the year/age at which you wish to retire.

E: Investment—Column D for year increased by the percentage in cell 3.

F: Accumulated Investments—in year 0, put 0; in subsequent years, put the previous year’s value increased by the percentage in cell 4, plus the current year’s investment from column E.

Evaluate your spreadsheet using cell 1: \($60\),000; Cell 2: 10%; Cell 3: 10%; Cell 4:8%; Cell 5: \($2\),000,000; Cell 6: 3.5%. You should get \($619\),962.84 at the end of year 20.