College Fund

2017 Goals and Quarterly Updates

/ humblefi / 2 Comments

NOTE: Fourth Quarter, 2017 Update….on 12/22/2017

I started my humble journey towards Financial Independence in 2014. But, I really did not have any formal goals for 2014. I just wanted to create multiple passive income streams, protect my family with life insurance, etc. I established what Financial Independence means to me and what the goals were. I accomplished all the implicit goals I had for 2014.

For 2015, I was a little bit more formal about goal setting and set my 2015 goals and updated my progress quarterly (here). In addition, I also tracked my progress via a Monthly Progress Report (here). At the end of year 2015, I reviewed my progress towards FI and I was happy to have reached and/or exceeded most goals I set (here).

For 2016, I achieved most of the goals I set out for myself (here). The two goals where I failed badly are: Keep eating expenses under $200 per month & Estate planning. I will try again this year i.e. in 2017.

The Financial Independence criterion for me (2017) are:

Financial Independence Criterion
Emergency Fund $60k (as of 2017)
College Fund $80k
Passive Income Streams $4000 per month
Retirement Fund $900k
Roof for our Family $750k….HCOL area 😦
Medical Fund $100k
Life Insurance To protect my earning years…..

For 2017, I have thought about the following goals to get me closer to the above financial independence goals. What is the current status of the goals:

  • Ones in Red are not complete
  • Ones struck-through are complete

Financial Goals

  1. Keep scouting for a possible home/multi-family residence/rental real estate
    1. 03/31/2017        Visited many open houses…single/multi family…prices still crazy
    2. 06/30/2017        Visited two open houses….prices even more crazy this quarter…
    3. 09/30/2017        8 more….we finally know what we want….need the $$$ now 🙂
    4. 12/31/2017        0 homes….prices shot up & pushed most houses out of our budget
  2. Contribute $15000 towards Home Downpayment Fund
    1. 03/31/2017           $10272/$15000            $4728 remaining
    2. 06/30/2017           $13772/$15000            $1228 remaining             
    3. 09/30/2017           $16701/$15000            Done..but price rises outpacing savings 😦
    4. 12/31/2017           n/a
  3. Contribute $3600 to 529 College Fund 2 
    1. 03/31/2017        $305/$3600 done                     $3295 remaining (behind…)
    2. 06/30/2017        $1966/$3600 done                   $1634 remaining 
    3. 09/30/2017        $3467/$3600 done                   $133 remaining
    4. 09/30/2017        $3600/$3600 done                   $0 remaining
  4. Contribute $3000 to 529 College Fund 1
    1. 03/31/2017        $605/$3000 done                    $2395 remaining (behind…)
    2. 06/30/2017        $1767/$3000 done                  $1233 remaining
    3. 09/30/2017        $2427/$3000 done                  $573 remaining
    4. 12/31/2017        $3000/$3000 done                  $0 remaining
  5. Contribute $16k to Passive Income Streams (stretch goal of $24k) 
    1. 03/31/2017        $10150/$16000                       $5850 remaining ($13850 for stretch)
    2. 06/30/2017        $29970/$16000                       $0 remaining 
    3. 09/30/2017        n/a
    4. 12/31/2017        n/a
  6. Max out 401k contributions for both me and my wife ($36K total)
    1. 03/31/2017        $10489.19/$36K                     $25510.81 remaining
    2. 06/30/2017        $19774.94/$36K                     $16229.06 remaining  
    3. 09/30/2017        $33890/$36K                          $2109.47 remaining    
    4. 12/31/2017        $36K/$36K                              done
  7. Keep eating out expenses under $200 pm
    1. 03/31/2017       $358.61                                      Way above budget…
    2. 06/30/2017       $401.83                                      Out of control 😦 
    3. 09/30/2017       $301                                           Pulled in the expense some…
    4. 12/22/2017       $273                                           Pulled in the expense a little…
  8. Start and finish Estate Planning (Will, POD beneficiaries, Caretaker for children, etc)
    1. 03/31/2017  No progress yet      
    2. 06/30/2017  No progress yet
    3. 09/30/2017  Set up an appt with a financial planner….will discuss and decide
    4. 12/31/2017  Financial plan done; Will, POD, etc next year

Personal Goals

Starting this year, I am trying to track some personal goals. Without adding all the details and boring everybody, I will try to keep this simple. I am hoping tracking this in my blog will keep me motivated to reach my goals. Here they are:

  1. Health Body goals (healthy eating, gym visits, popping multi-vitamins, etc)
    1. 03/31/2017       21.4% success rate  ….nothing but improvement ahead 
    2. 06/30/2017       17.1% success rate ….oh boy…eating too much/no exercise…. 
    3. 09/30/2017       20.0% success rate….behind on flossing, popping vitamins mainly
    4. 12/30/2017       14.1% success rate ….no exercise…. 
  2. Simplify Life: Donate unused books once a month
    1. 03/31/2017       0/3 done                                
    2. 06/30/2017       3/3 done
    3. 09/30/2017       2/3 months done….got my kid to donate old books 🙂
    4. 12/31/2017       2/3 months done….books donated to two libraries  
  3. Simplify Life: Donate unused (old and new) clothes once per quarter
    1. 03/31/2017       1/1 done 
    2. 06/30/2017       1/1 done
    3. 09/30/2017       3/3 done….this time, it was clothes, toys and garage junk!!
    4. 12/31/2017       1/3 done…big kids toys cleanup done; waiting for donation  
  4. Simplify Life: Shred all unnecessary documents once a month
    1. 03/31/2017       1/3 done
    2. 06/30/2017       2/3 done….only 10 folders left…even found 10 year old docs! 
    3. 09/30/2017       1/3 done….a few more folders done….cabinet is so empty now 🙂 
    4. 12/31/2017       1/3 done….did not get to work on this much this qyarter 

Possible candidates for 2018 Personal Goals

I decided to start this section in the last quarter of 2017 (Oct-Dec) so that I can capture possible candidates for Personal goals in 2018.

  • Get together with a Financial Planner and checkpoint the overall state of our finances.
    • My goal was to generate $1000 pm in dividend income and then purchase our primary residence. I am close to the former but way behind the latter.
    • So, I want to set a plan for the next five years and getting a plan review from a qualified professional is timely now.
  • Prepare to find a new job with a better compensation package.
    • To support the house purchase, I need something more that the salary. I would like to add some additional options like a better bonus option, stocks, etc
    • This means I need to do really really well in the interviews…need solid preparation before I look into the market.
  • Get into a PE class of some sort and get my health in order.
    • Need the disciple of a class to help my will power.
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Financial Independence Progress Report for January 2017

/ humblefi / 7 Comments

The first month in the new year is done and it is time for the monthly update!

For the first time in the last couple of years, I am struggling with what should be my yearly goals for 2017. There are some basic goals that I will carry over from last year…like college fund, retirement fund, etc. But my struggle is mainly with the housing goal and that in-decision is affecting a couple other goals. But, I think I am getting closure on this issue and will update on the decision soon.

But for now, lets look at the numbers for Jan 2017.

02/05/2017
Emergency Fund $60K 100.0%
College Fund (80K) 47.95% 49.58%
Passive Income (2016 vs 2017) $592.90 (01/2016) $441.42 (01/2017)
Retirement Fund 64.27% 65.07%
Roof for our Family($750K) 00.00%
Medical Fund 00.5%
Life Insurance Done (term life insurance policy)

Main Takeaways this month

  • Passive Income Stream
    • Passive Income for Jan 2017 (441.42) is appx 30% lower than Jan 2016 ($592.90). This is a big decrease but an expected one 🙂
      • I sold all my ESPP shares from a previous employer and moved them into a couple different mutual funds. Basically cashed out for better risk diversification….shares in only one dividend company vs shares in many dividend paying companies.
      • The ESPP shares had an odd dividend payout frequency: Jan, April, July and October. Post the sale, dividends for these months will take a hit this year, but they will be more than compensated by investments with normal cycle of dividends in Mar, June, Sept and December.
  • Additional Investments
    • International exposure
      • Just like prior months, I continued to increase my exposure outside the US. Stocks in United States are way to overvalued and frothy in my opinion. I want my passive income stream to come from many countries all over the world as a good means of diversification.
      • So, I added to my existing investments in an Emerging markets fund (VEIEX) and Developed Markets International fund (VTMGX).
    • Build a tiny cash fund again
      • Since I have stopped investing in US stocks, I am accumulating that money in a money market fund. When the market tanks later this year, I want to have a small cash fund accumulated to take advantage of the dip.
  • Medical Fund
    • I signed up the family for a High Deductible Health Insurance Plan and got access to a Health Savings Account (HSA). $6750 of pre-tax money can be saved in it. HSA money is eligible for all valid medical expenses…free of federal and state taxes.
    • This will begin the accumulation of the Medical Fund. I have accumulated a couple of nasty health issues through all the ups and downs in life…this makes a medical fund an absolute necessity for my later years.
    • My hope is that the family medical expenses are small enough to be able to pay out of pocket now and let the HSA funds compound over the years. Lets see how it goes.

Financial Independence Progress Report for October 2016

/ humblefi / 8 Comments

October was a big down month! There was enough volatility in the month to show some RED in the nos. There were deals to be had in the early part of the month and I thought I made out good….until the later part of the month wiped out the gains 🙂 Let us see what the numbers say for October.

09/03/2016
Emergency Fund $60K 100.0%
College Fund (80K) 45.65% 47.95%
Passive Income (2015 vs 2016) $628.60 (10/2015) $551.80 (10/2016)
Retirement Fund ($900K) 66.36% 63.44%
Roof for our Family($750K) 00.00%
Medical Fund 00.00%
Life Insurance Done (term life insurance payments initiated)

Main Takeaways this month

  • College Fund Portfolio Increase (in green above)
    • I got some extra money left over after September and pushed that money  into the college fund. Even though October was a down month, the additional cash offset it.
  • Retirement Fund
    • This portion of my portfolio took a good solid hit in October. I lost almost 3% and the way early November is looking, it is not done going down.
    • Major reason is the increased uncertainty from US elections and the interest rate increase/decrease uncertainty from the FED.
    • I am definitely continuing to invest and am picking up stocks at lower cost i.e. Dollar Cost Averaging full speed ahead! So, all good for now.
  • Passive Income Stream
    • Passive Income for October 2016 ($551.80) is appx 14% lower than October 2015 ($628.60). This is a big reduction but an expected one.
      • I sold some stocks from a previous company’s ESPP and spread the money into different funds. These funds do not distribute dividends like my ESPP stocks in Jan, April, July and October. So, all these months will show a reduction in 2016. But, the overall dividends for 2016 will increase and will show up in December of 2016 when all the other funds declare their dividends.
    • Additional Investments
      • VTMGX (Developed markets across Europe, Canada and Australasia)
        • Just like last month, I continued to increase my exposure outside the US using VTMGX. Definitely lowered my cost per share via Dollar Cost Averaging this October.
        • If you want more details on VTMGX, please get it directly from the horse’s mouth: VTMGX.
      • VWELX (Vanguard Wellington Fund)
        • Bought into this fund also quite a bit this month.
        • I already have another balanced fund in my portfolio: VTMFX: 50% stocks and 50% tax-efficient bonds. VWELX is another competitor for my balanced fund dollars…I always have atleast two funds competing in the category…manager diversification and hence risk diversification as well. 
        • VWELX is not as tax efficient as VTMFX since the bond portion is not tax-efficient. But I want risk diversification more….
    • My 2016 goal is to reach $750 pm in passive income by end of 2016…October is done…and my per-month dividend is at $603.04 pm.
      • Target Dividend: $9000 pa
      • Current Dividend (year to date): $7321
      • Balance to make up in the next 3 months
        • $9000 – $7321  => $1679 over the next 2 months
      • Unless a black-swan event happens in the next two months, it looks like I will make it…hurrah!!
    • I had kept some cash aside to invest in a dip….the temptation to get to $750 in passive income per month was very high in September and I could could not resist and burnt some of it. In October, I used up the rest of the money to buy the dip. October is historically volatile…and it did not disappoint this time…so, the purchases this month will help in the coming year!
    • I anticipate another volatile month in December 2016…post the FED’s decision on interest rates….scrambling to accumulate some cash for that. Lets see…

Financial Independence Progress Report for August 2016

/ humblefi / 7 Comments

August also has come and gone without much fanfare. Another very slow month…so slow that I felt like doing something just to make it less boring. But, I reminded myself that it is the lull before the storm that I anticipate may start in September (historically a rough month). But, lets look at numbers for August.

09/03/2016
Emergency Fund $60K 100.0%
College Fund (80K) 44.30% 44.92%
Passive Income (2015 vs 2016) $297.54 (08/2015) $391.93  (08/2016)
Retirement Fund ($900K) 64.66% 65.01%
Roof for our Family($750K) 00.00%
Medical Fund 00.00%
Life Insurance Done (term life insurance payments initiated)

Main Takeaways this month

  • Portfolio Increases (in green above)
    • Nothing great to talk about…I still think that the positive gains of this year will not stand the test of time…..insane valuations will always come crashing down.
  • Portfolio changes
    • No portfolio changes this month….still adding to the cash fund I set up last month. If there is a good market dip (saw DOW drops 200-300 pts), I will use the cash to buy the dip.
  • Passive Income Stream
    • Passive Income for August 2016 ($391.93) is higher that August 2015 (297.54). This restarts the streak of 2016 dividends being more than 2015 dividends for the corresponding months. The streak got broken last month because I was in the middle of some portfolio changes….happy to get it back this month 🙂
    • My goal is to reach $750 pm by end of this year…it is already August…and my monthly dividends are appx $433 pm.
      • Target Dividend
        • $9000 pa => $750 pm
      • Current Dividend
        • $5593 pa => $466 pm
      • Balance to make up in the next 5 months
        • $9000 – $5593  => $3407 over the next 4 months
        • I have kept some cash aside to invest in a dip….I could invest it right now and increase my chances of making my target of $750 pm dividend income. But, I have chosen to wait a bit for value by waiting for a market dip and then using the cash. September is another big month for dividends. Based on how September does, I will decide.
        • I think I might squeeze through….keeping fingers crossed.

Financial Independence Progress Report for July 2016

/ humblefi / 6 Comments

July has come and gone without much fanfare. After June, one of the two biggest months of the year for dividends, July feels disappointing actually. But, let the numbers speak rather than my emotions 🙂

08/01/2016
Emergency Fund ($72K)$60K 100.0%
College Fund (80K) 42.53% 44.30%
Passive Income (2015 vs 2016) $604.87 (07/2015) $579.61  (07/2016)
Retirement Fund ($900K) 61.64% 64.66%
Roof for our Family($750K) 00.00%
Medical Fund 00.00%
Life Insurance Done (term life insurance payments initiated)

Main Takeaways this month

  • Portfolio Increases (in green above)
    • I cannot believe that any of the positive gains will ever stand the test of time. It is the markets going crazy on us with insane valuations. So, I will not waste my time talking about it.
  • Portfolio changes
    • I did some more portfolio changes….hopefully for the last time this year. The main idea was to capture some gains and move them into a couple of new fund options. And also set aside some money for the cash fund.
    • I wrote about this here. My new mutual fund investments are VWELX and VDAIX.
  • Cash Fund
    • I started a cash fund in May since I anticipated a few days of down market towards the end of June…with the interest rate drama, Britain’s exit from Euro decision, etc. I used the fund completely to buy the Brexit dip.
    • I have started a new cash fund in July again…nothing big..two hundred dollars a month max. And some cash to seed the fund came from capturing some of the gains from some of my mutual funds.
  • Passive Income Stream
    • Passive Income for July 2016 ($579.61) was surprisingly lower than that of July 2015 (604.87). I was wondering why this happened…..and then I remembered on seeing the numbers. When I was jobless early this year, I sold some ESPP stock I had and used the money to buy VWITX (National MUNIs). I got to sell some ESPP without any additional taxes….the espp sale replaced some portion of my salary loss. The ESPP stock dividends are slightly more than the National MUNIs but at tax time, the MUNIs will score because the gains are tax free. I got the diversification I wanted but it came as a surprise.
    • My goal is to reach $750 pm by end of this year…it is already July…and my monthly dividends are appx $433 pm.
      • Target Dividend
        • $750 pm => $9000 pa
      • Current Dividend
        • $433 pm => $5196 pa
      • Balance to make up in the next 5 months
        • $9000 – $5196  => $3804 over the next 5 months
        • I think I might squeeze through….inspite of July’s weak dividends.
      • Lets hope for the best!!

Financial Independence Progress Report for June 2016

/ humblefi / 6 Comments

June is finally done! It is one of the two biggest months of the year for dividends. And it did not disappoint me 🙂 Lets look at June’s numbers. In a later post, I will do my quarterly review for the 2nd quarter and see how I am doing for the yearly goals.

07/02/2016
Emergency Fund ($72K)$60K 100.0%
College Fund (80K) 42% 42.53%
Passive Income (2015 vs 2016) $1038.14 (06/2015) $1741.69 (06/2016)
Retirement Fund ($900K) 61.31% 61.64%
Roof for our Family($750K) 00.00%
Medical Fund 00.00%
Life Insurance Done (term life insurance payments initiated)

Main Takeaways this month

  • Dollar Cost Averaging
    • In May, I reduced my Emergency fund and moved some of it into a new Dividend mutual fund (VDAIX). I was keeping the remaining money as a Cash Fund to invest on the next market downturn….and boy…did Brexit provide that for me.
    • Brexit turned out to be a boon for me. The market dropped on two consecutive days in a big way….DOW dropped by 600 points and 300 points on consecutive days. Thanks to the people of United Kingdom for this!
    • I had a couple thousand dollars left over from the emergency fund makeover and pushed all the money (and some) into my passive income streams. Yeah for dollar cost averaging….this cash infusion will make its presence felt over the years via dividend compounding.
  • Cash Fund
    • I started a cash fund in May since I anticipated a few days of down market towards the end of June…with the interest rate drama, Britain’s exit from Euro decision, etc.
    • I used the fund completely and now I am officially out of cash…I mean I am so out of cash that I had to borrow money from my wife to pay the bills for this month. I am never going to hear the end of this for sure 🙂
    • So, for the next 3-4 months at least, I will have to run a very very tight ship 😦 Hey, the sacrifices will pay off in the long run right? And the dividends coming in will hopefully keep me motivated and help me ride out the low-cash situations.
  • Passive Income Stream
    • Passive Income for June 2016 recaptured the increase in dividends over the same period last year. June 2015 had a dividend income of $278.52 and June 2016 has a dividend income of $378.08 …a decent year-over-year increase.
    • My goal is to reach $750 pm by end of this year…considering we are at the half way mark for the year and my monthly dividends are close to $400 pm, I can see now that I am going to reach it….eagerly waiting for the day when this event happens!

2015 Goals and progress updates

/ humblefi / 6 Comments

NOTE: Updated quarterly; latest update is on 12/26/2015 

I started my humble journey towards Financial Independence in 2014. I did establish what Financial Independence means to me and what the goals were. But, I really did not have any yearly goals for 2014. I just wanted to come up with a plan and create multiple passive income streams and let them fly, protect my family with life insurance, etc. I believe that I have accomplished all the goals I implicitly had for 2014. For 2015, I wanted to be a little bit more formal about goal setting and I will document my 2015 goals in this post, updated quarterly. Monthly Progress Report is tracked here.

The Financial Independence criterion for me are:

Financial Independence Criterion
Emergency Fund $72K
College Fund $80K
Passive Income Streams $4000 per month
Retirement Fund $900K
Roof for our Family $1 million
Medical Fund $100K
Life Insurance Done initiating.

For 2015, I have thought about the following goals to get me closer to the above financial independence goals. The updates are quarterly for each goal.

  1. Max out 401K contributions for both me and my wife.(Done: 12/31/2015)
    1. 2015 401K limit is $18000 => $36K worth of 401k contributions.
      1. 03/31/2015 $13K/$36K done       $23K remaining
      2. 06/30/2015 $26K/$36K done       $10K remaining
      3. 09/30/2015 $32K/$36K done       $4K remaining
      4. 12/26/2015 $36K/$36K done        $0K remaining
  2. Contribute $16000 to Passive Income Streams (stretch goal of $24000) Done (09/30/2014)
    1. VCAIX, VTMFX, VDIGX, VHDYX, VTCLX, VTMSX, VTMGX, VMMXX.
      1. 03/31/2015 $4K/$16K done         $12K remaining
      2. 06/30/2015 $8K/$16K done         $8K remaining
      3. 09/30/2015 $25K/16K done         $0K remaining
      4. 12/26/2015 $37K/16K done         $0K remaining
  3. Contribute $4800 to 529 College Fund (Done: 12/31/2015)
    1. Vanguard 529 Plan
      1. 03/31/2015    $1200/$4800          $3.6K remaining
      2. 06/30/2015    $2400/$4800          $2.4K remaining
      3. 09/30/2015    $3600/4800            $1.2K remaining
      4. 12/26/2015    $4800/4800            $0K remaining
  4. Deposit maturing CDs into passive income streams Done(01/17/2015)
    1. VCAIX: $35K   $30K
    2. VTMFX: $10K $20K
    3. VDIGX: $10K  $15K
    4. VHDYX: $5K   $10K 
  5. Keep scouting for a possible home (Not Done: 12/26/2015)
    1. A paid off house is a must for financial independence.
      1. 03/31/2015         No progress
      2. 06/30/2015         Finished mortgage analysis, finally!
      3. 09/30/2015         Scouting properties….not much luck.
      4. 12/26/2015         Prices way out of reach. Some discussions on relocating to a different state…not sure yet
  6. Start and finish Estate Planning (Not Done: 12/26/2015)
    1. Will, POD beneficiaries, Caretaker for our child, etc
      1. 03/31/2015        No progress
      2. 06/30/2015        No progress
      3. 09/30/2015        No progress
      4. 12/26/2015        No progress…definitely for the coming year
  7. Get a more stable job. (Not Done: 12/26/2015)
    1. Current job is on very shaky foundations
      1. 03/31/2015        No progress
      2. 06/30/2015        Interview preparation started!!
      3. 09/30/2015        Interview preparation slowed down 😦
      4. 12/26/2015        No resolution yet…need more will power 😦

How long does it take to accumulate $80000 in a 529 College fund?

/ humblefi / 1 Comment

When I defined what Financial Independence means to me (here), $80000 dollars in a college fund for my kid seemed good to me….how I came up with that number is listed here. I did not have any notion of how to get there apart from creating a 529 fund and regularly depositing money into it.

The next question for me now is: how long before I get $80000 in the 529 College fund? This post will talk about how to come up with a time estimate.

Savings Calculator

There are two nice calculators that we can use to estimate how many years it will take to accumulate a certain sum of money, if we know the monthly investment that one is ready to invest.

  1. Savings Calculator from FINRA
  2. Bankrate.com’s Savings Calculator

The college fund for my kid is invested in a Vanguard 529 plan. I am going to assume that this fund returns about 3% average over the next 9 years. This is when my kid will be ready to enter college. I am going to use the Savings Calculators listed above to estimate when the 529 plan will reach a target amount of $80000.

Parameters for the Calculator

The input that the calculator needs is as follows:

  1. Initial Savings Balance: $25,310
  2. Deposit Interval: Monthly
  3. Deposit Amount per interval: $400
  4. Number of Deposits: 108 (12 months * 9 years = 108)
  5. Annual Return: 3.0% and 5% (conservative and average growth rate for the 529 Plan)
  6. Inflation Rate: 3.0%

Now, lets calculate the time required to reach $80000 at two growth rates: 3% and 5%.

Case 1: Calculator Results at 3% Return

By inputting the above parameters to the calculator, here are the results after 104 months of investing $400 at appx 3% average rate of return per year.

  • Ending Balance: $82,576
  • Inflation Adjusted Balance: $59,030

No   Period        Deposit      Balance           Inflation Adjusted Balance
1     Jan-2015  $400.00     $25,773.41     $25,693.43
13   Jan-2016  $400.00     $31,424.26     $30,179.91
25   Jan-2017  $400.00     $37,244.63     $34,460.31
37   Jan-2018  $400.00     $43,239.62     $38,542.51
49   Jan-2019  $400.00     $49,414.46     $42,434.08
61   Jan-2020  $400.00     $55,774.54     $46,142.32
73   Jan-2021  $400.00     $62,325.42     $49,674.25
85   Jan-2022  $400.00     $69,072.83     $53,036.64
97   Jan-2023  $400.00     $76,022.66     $56,236.01
98   Feb-2023  $400.00    $76,611.14     $56,495.46
99   Mar-2023  $400.00    $77,201.07     $56,753.83
100 Apr-2023  $400.00     $77,792.46     $57,011.12
101 May-2023 $400.00     $78,385.30     $57,267.33
102 Jun-2023  $400.00     $78,979.61     $57,522.46
103 Jul-2023   $400.00     $79,575.38     $57,776.53
104 Aug-2023 $400.00     $80,172.62     $58,029.53

Case 2: Calculator Results at 5% Return

By inputting the above parameters to the calculator, here are the results after 90 months of investing $400 at appx 5% average rate of return per year.

  • Ending Balance: $80,050
  • Inflation Adjusted Balance: $60518

No Period         Deposit       Balance          Inflation Adjusted Balance
1   Jan-2015     $400.00     $25,814.75     $25,734.64
13 Jan-2016     $400.00     $32,034.51     $30,766.00
25 Jan-2017     $400.00     $38,565.27     $35,682.22
37 Jan-2018     $400.00     $45,422.57     $40,488.33
49 Jan-2019     $400.00     $52,622.72     $45,189.15
61 Jan-2020     $400.00     $60,182.89     $49,789.36
73 Jan-2021     $400.00     $68,121.07     $54,293.46
85 Jan-2022     $400.00     $76,456.15     $58,705.82
………………………………………………………
90 Jun-2022     $400.00     $80,050.93     $60,518.23

Conclusion

From the calculator’s results above, we can see the following results for investing $400 per month in a 529 plan.

  • At 3% annual return, it takes 104 months (approximately 9 years) of investing.
  • At 5% annual return, it takes 90 months (approximately 7.5 years) of investing.

Wish me luck that I can get this done within 7.5 years!!