The Motley Fool Discussion Boards
Investing/Strategies / Retirement Investing
|Subject: Re: Strategy comparison S&P500 vs. IUL [rev 1]||Date: 4/4/2013 7:40 PM|
|Author: Rayvt||Number: 71714 of 80374|
On a simple annual point-to-point the opening day and anniversaries are the market data points. If the ultimate year's returns were 12%, then any principal balance in place from the initial anniversary gets a credit of the full 12%,
Yes. That't the way I did it.
and any subsequent mid-year contribution gets a pro-rated credit according to the portion of time in.
I didn't do that. I just credited the entire year's worth of additional contributions all at once.
[Let me check... be right back....]
Yes. No prorated credit.
New value = (gain_factor * (old_value - expenses)) + all intra-year deposits.
I can change it to a better approximation. Assuming level additions, on average, full gain on the average annual additon balance is Close Enough. Adds to the complexity, though, so CC will scream. ;-)
Yup, it makes things a bit better. For $10,000 & $100/mo, ends with $351,300 instead of $343,700
At the anniversary, all original principal, plus any accumulated growth to date, is considered principal going forward. The straight PTP IU