Mrs. Doyle has a surrender value of $22,000 and could additionally invest $180 monthly for 12 years. Her policy promises $78,000 at maturity. What return would an alternative investment need to keep up?
ℹ Surrender value as starting capital plus an ongoing savings rate.
Change any number and press "Calculate" – or use "Type in" on the right to watch it entered.
Before canceling, first work out the minimum return: only if the alternative clearly beats this threshold is switching worthwhile – otherwise you give up security for no reason.
With a savings plan the rate cannot be solved directly because it appears in several places of the formula. The calculator tries it iteratively until the deposits and target value match exactly (internal rate of return). This is how, for example, the true return of an insurance policy becomes visible.