Tuesday, June 02, 1998

Who Wants To Be a Millionaire?
by Peter O'Connell ([email protected])

One great, if fairly useless, web site is called "What Will It Take to Become a Millionaire?" at http://www.smartcalc.com/
cgi-bin/smartcalc/SAV1.cgi/Kiplinger.

This site has a little program where you key in your age, the amount you can invest now, what you can invest monthly, what return you can achieve, tax rates, and so on. You then hit the magic "Calculate" button, and 5 seconds later your dreams are shattered. It tells you when you will be a millionaire. You can also key in a target age, and it tells you what you could change to achieve that target.

I first came across the site when I was Wise. I had virtually nothing saved, not a lot to invest monthly and had no idea what rate of return I could make, so I entered 8% (inflation is set to 3%). Fortunately, I had age on my side (I am 29), so in fact YES, I would become a millionaire -- at age 73! To reach my target age of 55, it told me I needed an extra $107,015 to invest immediately!

A few months passed and I became a little more Foolish. I have a small amount to invest now, I have a reasonable monthly savings target, and I have a good idea what sort of return I can get on my investments. I re-visited the site today and keyed in the new figures, pressed the magic "Calculate" button and again, my dream was shattered.

Well, maybe just cracked a little. The program put me on Millionaire Row at age 56 -- just one year after my target! Reading the analysis, I was shocked: if I can just invest another $30 a month, I’m there! I think I’ll go and look at my savings plans again.

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