Investment calculations are tricky – it’s impossible to predict accurately exactly what your investment returns will be. However, it’s possible to look at trends and past results and use the standard accepted numbers and make educated guesses at what end result your investment strategies will hopefully reap in the future.

1. It’s important to first identify what your goals are. Are you saving for a family trip to Disney Land? Do you want to retire at age 60? Are you planning to build a vacation home when you’re 45? Do you want to buy a home big enough to house both you and your parents when they are too old to care for themselves? Figure out your goals, then find calculators online to help you predict what that cost will be by the time you get there. A vacation home built today will cost much less than a vacation home built in twenty years.
2. Recognize how investments typically work. Investments tend to grow in worth and pay out, but sometimes they decrease in value. Not all investments are equal in risk or payout, so you’ll need to research what types of investments you’ve made and figure out what kind of returns you can expect to get from them – and at what time you plan to cash out on them.
3. Decide how much you can put aside in investments each year and make a specific plan. Using tools like online calculators, you can calculate out things like how much a bond will yield (try www.the-bond-site.com) or a particular investment could yield (try http://money.aol.com.)
4. Estimate compounding interest investments. The simplest and most predictable (but often lowest yielding accounts) involve compounding interest. A savings account or a CD (certificate of deposit) may have low yields, but is a reliable way to invest in a predictable manner.
5. Conservatively estimate returns from stocks and bonds. These investments are less predictable and are more difficult to predict.
6. Meet with a financial advisor skilled in guiding investments. An advisor will know the ins and outs of all the various investments and will have tools available to help you know if you’re on track with the amount you are making and investing in relation to the amount you are investing.
7. Educate yourself online. Try the free or low cost seminars available on the web; read articles detailing the specifics of different investment strategies.
8. Once you feel you have a good handle on what kinds of investments you want to make, sit down with those calculators again and start planning. Try to calculate out your salary predictions for the future. Estimate insurance costs and costs of living. Figure out what you will need for retirement and your other goals. While it’s a lot of crunching numbers, you’ll feel more confident with a solid plan in hand.
9. If doing the calculations yourself is overwhelming, employ a financial advisor to help you figure out a plan. Some advisors charge money upfront; some work for free as long as you invest using their firm. Check out the costs before you commit, and take advantage of the education programs and materials they will provide.