TMV VTI/VOO Index Fund

[jnw]

Playing around with some Time Value Money calculations on my 1987 HP 10B business calculator (this thing is a gem to use.. such beautiful craftsmanship and keypad).

What interest rate should I use for the total stock market (VTSAX/VTI) and/or s&p 500 index funds?   Like 9%?   I've been putting in 7%.  Do I compound the contribution payments monthly or yearly?   (This is for 19 years.)

I figure I don't need to take inflation into consideration, since if there is inflation my contribution will go up by that amount.  Am I wrong thinking this?  My savings rate is 61% of my income currently.

[MustacheAndaHalf]

Almost every research paper and article I've read talks about annual rates of return.  Although it sounds like this calculator is capable of much more, you would only need to use annual compounding.

It's probably a good idea to use "real return" that includes inflation.  If you thought the market return was 7% or 9%, you might subtract 3% for inflation and come up with a 4% or 6% real return.  That let's you compare your retirement dollars with the cost of things today.