People are always looking for tools to help them know where their money and wealth accumulation are going. A velocity banking calculator is a type of useful tool/calculator that can provide you with a virtual board of your financial situation and helps make the right investment decisions.
Read more to explore five types of velocity banking calculators.
5 Types of Velocity Banking Calculators
Maximum Potential Calculator
People like to invest their hard-earned money to create more wealth. However, several factors influence your investment strategy, and you should be aware of them. The Maximum Potential Calculator gives you a complete illustration of your investment strategy through inflation, lifestyle, debt service, and tax implications.
How Does It Work?
The calculator requires you to enter your earnings and investment targets, and the tool will show you how much money you can make before and after paying taxes. In addition, it will help you decide on investing in tax-saving instruments that can help you realize more savings and increase your wealth.
Funding Illustration Calculator
Many people invest in life insurance, while many stashes their cash in saving accounts. The funding illustration calculator will help you understand how life insurance can be a better investment vehicle for long-term investment strategy.
In addition, the calculator will show you the performance of whole life insurance and savings on the same page and help you better understand both investment options.
How Does It Work?
The calculator requires you to add the current age and the projected age of the individual. You also have to add the annual interest rate and the tax bracket for both investment vehicles, and the calculator does the mathematical calculations and presents you with saving projections.
Diversification Calculator
No investment avenue is completely safe and has inherent risks. Hence, investment planners advise clients to diversify investments to minimize risks and maximize profit. But the big question is how to know which investment avenue to choose and analyze their performance.
The diversification calculator allows you to compare the performance of your assets in different investment vehicles. With a velocity banking calculator, you can compare investments and their performance over the years in a single view, side-by-side. For example, the calculator will show how you can benefit from moving your assets out of a low-earning savings account to another investment vehicle that can give you better returns over the years and help build a solid retirement fund.
How Does It Work?
You can enter asset value, annual earnings, and interest rates for each investment vehicle and get a straight comparison.
Capital Budgeting Calculator
The capital budgeting calculator is a useful financial tool that helps you determine the quality of the investment. It can help you find the rate of return for varying streams of payments and varying streams of withdrawal. With the internal rate of return calculator, you can show the merits and demerits of the investment with other alternatives.
How Does It Work?
You need to add annual investment in the calculator and the net annual cash flow, and the tool will calculate the annual income for the investments.
Accumulation Calculator
The accumulation calculator shows how your investments are working and how you are accumulating wealth.
How Does It Work?
The calculator allows you to set a series of variables like term insurance, earning rates, tax structure, loads, and management fees. This in turn helps you calculate your accumulated wealth.
These are some useful calculators that encapsulate velocity banking. These calculators make financial planning easy and give you a complete view of your investments to help make an informed decision.
