### Author Topic: Need mathemagician help estimating future pension  (Read 2959 times)

#### wtjbatman

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##### Need mathemagician help estimating future pension
« on: February 03, 2015, 06:11:44 PM »
Alright you math nerds. I've spent time making fun of you, now I need your help. Let's do this.

I need a way to estimate my future pension. Preferably some sort of spreadsheet I can use just to make it easier on me. But I'll take what I can get. The details of how the pension works:

Each quarter (so 4 times a year, look I am good at math!) an amount of money figured from the below chart is deposited into my pension account. Obviously the main variables are my actual age + how long I've been working for this employer, and what my salary is (to determine the pay credit). In the meantime, the money in the account is growing. Once each quarter, before the new \$\$ is deposited, a 4.64% interest rate is applied to the old account balance (Edit: It's a 4.64% annual growth rate, not every quarter) So if the account balance was \$100, after the next quarter the account balance would be \$104.84. Then the new \$\$ is added.

Age + Years at Job    Pay Credit
Less than 40           1.5%
40 – 49                    2.0%
50 – 59                    2.5%
60 – 69                    3.0%
70 – 79                    4.0%
80 – 89                    5.0%
90 or more               6.5%

I want a way I can not only enter in my current numbers, but also estimate future growth. So obviously as I age plus spend more time at this job, my Pay Credit will go up. At the same time I expect regular increases in salary (3%-5% a year), so the actual \$\$ amount of each pay credit will rise along with the percentage of my salary.

Edited to clarify that 4.64% is the Annual rate of account growth.
« Last Edit: February 03, 2015, 06:34:57 PM by wtjbatman »

#### Eric

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##### Re: Need mathemagician help estimating future pension
« Reply #1 on: February 03, 2015, 06:14:36 PM »
You get a 19.36% annual return on your pension?  (4.84% * 4 quarters)

#### wtjbatman

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##### Re: Need mathemagician help estimating future pension
« Reply #2 on: February 03, 2015, 06:16:01 PM »
You get a 19.36% annual return on your pension?  (4.84% * 4 quarters)

That doesn't sound right, hah. Let me look at the plan description some more.

#### wtjbatman

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##### Re: Need mathemagician help estimating future pension
« Reply #3 on: February 03, 2015, 06:21:40 PM »
Ok so it's broken down into a daily percentage? So this is the example they use. First number is the account balance, second number is the daily rate of 4.64% (not 4.84, oops), then 92 days in the quarter, = the amount of interest earned on that balance.

\$440.78 x 0.01242699% x 92 = \$5.04

#### seattlecyclone

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##### Re: Need mathemagician help estimating future pension
« Reply #4 on: February 03, 2015, 06:30:37 PM »
Okay, sounds like 4.64% is the annual rate (1.0001242699 ^ 365 = 1.0464).

#### wtjbatman

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##### Re: Need mathemagician help estimating future pension
« Reply #5 on: February 03, 2015, 06:35:30 PM »
Okay, sounds like 4.64% is the annual rate (1.0001242699 ^ 365 = 1.0464).

I edited the OP to fix that! Thanks guys! See, you've already helped me.

#### seattlecyclone

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##### Re: Need mathemagician help estimating future pension
« Reply #6 on: February 03, 2015, 06:50:32 PM »

#### wtjbatman

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##### Re: Need mathemagician help estimating future pension
« Reply #7 on: February 03, 2015, 07:00:04 PM »