|Year||Starting Amount||Annual Contribution||Total Contributions||Total Interest Earned||Amount|
in the above calculator the calculation is based that the additional contributions occurs at the start of each year. This will be your starting capital of your investment each year.
All the investments have risks and what type of assets you prefer depends on your risk tolerance. Usually, there is a positive correlation between risk and returns the higher risk the higher the returns. Managing financial assets is a complex job so simple solutions are mutual funds or index funds that for some they will take care of the management. Keep in mind you always there is change to lose the principal capital this depends on market conditions and risk management.
Starting investing always need to have some money on the side, that could be your savings from your income or other sources. There are many types of investments that could be in money markets and mutual funds (stocks, options, bonds), real estate market or buying a piece of business. Every case has a different type of risk and rewards and your decision could on your risk tolerance the spare time you want to manage it. For example, for as low $1000 you could start with mutual funds that handle and manage financial assets. A good start is on beginning on something you can understand and explain back in less than 2 minutes that means you invest in things that you understand easily.
When you decided on the starting amount of investment, you will expect some kind of return, a usual number of a safe risk investment is 3.8%. Each investment has a different type of returns but will assume that you have a diversified portfolio of any type of stocks, houses, so you will set a default expected rate of return to 3.8%. Don't forget the higher the risk the higher the return.
The years of accumulation is how many years you will expect to liquidate your investment. There short term investment less than 3 years, intermediate-term 3 to 10 years and long term investment over 10 years. The longest you invest the higher effects of the compound interest rate.
When a broker negotiate with an investor to buy a bond for example from municipality state of USA, its asset has a unique number where someone is able to extract information about this financial asset. Having this info somone determine the fair value using the necessary financial models
Brokerage Account is an investment account that you can open with a bank or an investement company. Once you opened an account and your trasfer funds you start buy bonds, stocks and other financial instruments. Usually there is not fee to open an account, but if you personally want to make the transactions there is a trade fee per transaction. If you want someone else to manage your investment you open accounts with robo-advisors that that charge a management fee, you can check for Robo-Advisors like etfmatic.com