Figure Out Your Finances
Hey y'all, it's Val B! You know I absolutely love sharing any and every financial resource and tool I find. I did a June 2020 Finance & Economics Q&A on Instagram and you all blew me away with your questions. There were so many that I had to break it down into categories. The categories ended up being budgeting, saving while in college, when to hire a financial advisor, investing, and Excel tips and tricks. I shared with you all my Excel cheat sheet, but I just felt like I couldn't give personalized answers through my broad explanations. SOOOO I found this FREE website that allows you to calculate literally anything & everything finance related, Pigly.com!
Courtesy of Pigly
You could be looking to calculate how much compounding interest will make you over time. You could be looking to see how much you have to save each month to reach your goals or how to calculate what your monthly loan payment is going to be given the interest rate. All of this data is necessary to live a healthy financial lifestyle. I am so passionate about financial literacy and providing the resources that I believe are quick and easy to work with, especially because I realize not everybody may love numbers as much as myself, the financial analyst.
So what exactly does it mean to be financially literate? Well, this question could be interpreted differently by everyone, but I grabbed a basic definition from Investopedia, one of my favorite financial knowledge resources that all levels of people use, even highly paid finance professionals.
Courtesy of Investopedia.com
The best part about finding Pigly was that its platform has calculators for all of the above mentioned by Investopedia. The website has a site map that sorts all of the calculators into their major categories, BUT I wanted to show you the category I've been focusing on for my own personal finances most recently. Y'all know I am a financial analyst and recently started a new job in the banking industry. As a new employee, working with HR to set up your benefits and retirement contributions is one of the most important (& confusing) onboarding tasks, in my opinion. I feel like as a college graduate, planning for retirement is the last thing on your mind, but I can't tell you how beneficial it is to start saving for retirement early! Pigly published a quote on their website that reads:
Courtesy of Pigly.com
I also want to share an article from Forbes that explains in a bit more depth why retirement planning is even more crucial now than it has ever been. This article is from 2018, but shares three big reasons that still apply today. The one we always talked about most in my finance classes is that Social Security may very well be out of funds by the time I reach retirement age. The other two mentioned focus on employers not offering as many retirement benefits and the people of society outliving their savings. I encourage you to read the article in full on your own so I will link it here:
Courtesy of Pigly.com
Pigly's Retirement Calculators include Saving for Retirement, Retirement Savings Plans, Required Savings, Annuity Present Value, and 401(k) Rollover. I've been playing around with all of these, but just to show y'all an example, I am going to break down how to use the Annuity Present Value Calculator because it was most certainly a syllabus item in many of my college finance courses. The link to this calculator is here:
Annuity Present Value Calculator Example
First and foremost, annuity present value is used to figure out the present (today's) value of future payments from the annuity. Based on the amount you'd like to receive to live on in the future, your goal is to calculate how much you need to save/contribute today to reach that goal for retirement in the future.
Okay so the breakdown of a hypothetical situation:
Let's say you'd like $3,000 paid out monthly to live on for 25 years after retirement. I went with a conservative rate at 3%, close to the average inflation rate.
SO in order to have $3,000 per month for 25 years in retirement with a 3% interest rate, you'd have to save $632,629.36 in today's dollars. This allows you to use this number when calculating how much you'll want to contribute to your savings from each paycheck so that you can live up to these means in retirement (& sit on the beach comfortably every day!!!)
Courtesy of Pigly.com
I am SUPER excited to be sharing this website with you all! If you are confused about what some of the calculations mean in general or even what the numbers mean to you, Investopedia always has thorough explanations or as always, you can reach out to me via Instagram DMs with any questions as well. I live for finance questions so please don't hesitate to ask!
Courtesy of Pigly.com
Sponsored by Pigly
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