Goal Lumpsum Calculator
Understanding Reverse Lumpsum
A reverse lumpsum calculator helps you determine the initial lumpsum investment required to reach a specific financial goal over a given period, considering an expected rate of return.
Key Concepts:
- Target Amount: The final amount you want to achieve at the end of the investment period.
- Investment Period: The total duration over which you will invest, usually expressed in years.
- Expected Return: The annual rate of return you anticipate from your investments, typically represented as a percentage.
How it Works:
The calculator breaks down your financial goal (target amount) into the initial lumpsum investment required, factoring in the compounded returns over the investment period.
Calculation Formula:
Initial Investment = Target Amount / (1 + r)^n
Where:
r
: Annual return rate.n
: Total number of years.