What calculation can I use to find income on a fixed investment?

K

Ken K

Does anyone have a calculation to find a monthly income on a fixed amount
investment?
 
T

tim m

Need a bit more information perhaps. Are you drawing money from this fixed
amount? Is this investment making a fixed rate of interest? Is there a
specific period of time you want to draw money from the investment?
 
K

Ken K

Thanks for the response, yes a fixed amount with a fixed interest rate and no
specific period of time. What I am trying to accomplish is how much I need to
put away at a fixed rate to replace a fixed income I now receive.

Thanks,

Ken
 
F

Fred Smith

Calculating interest income is a simple percentage calculation. Suppose you need
$2000/month of income, and you expect to make 5%/yr on your money. The capital
you would need is:

=(2000*12)/.05

If you want to spend both the interest and principal, you would calculate the
present value required, as in:

=PV(5%/12,#months required,2000)
 
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