wealth-builder.js

// Coyright dcorking, 2016
// MIT License and disclaimer of warranty
interestRate = 15;  // in basis points, that is 15 is 1.5%
marginalTaxRate = 200; // 20%
nationalInsuranceRate = 0; // not in model

annualContribution = 300; // in pounds, before tax

yearsParticipation = 20; // years paying into plan

// simple interest, contribution at start of year
oneYearOutput = function (principal, contribution, interestRate) {
  return (principal + contribution) *  (1000 + interestRate) / 1000;
}

// compound interest, contribution at start of year, interest paid at
// end of year
nYearsOutput = function (n, principal, contribution, interestRate) {
  var sum = principal; // running total
  for(var i=0; i<n; i++) {
    sum = oneYearOutput(sum, contribution, interestRate);
    console.log(sum, i);
  };
  return sum;
};

// isa-style saving: pay tax on income before save it, don`t pay tax
// on growth or withdrawals
isaSaving = function (n, principal, contribution, interestRate) {
  return nYearsOutput(n,
                      principal,
                      contribution * (1000 - marginalTaxRate) / 1000,
                      interestRate);
};

// pension-style saving: save pre-tax income, grows tax free,
// but pay income tax on withdrawals
pensionSaving = function (n, principal, contribution, interestRate) {
  untaxedSum = nYearsOutput(n, principal, contribution, interestRate);
  return untaxedSum * (1000 - marginalTaxRate) / 1000;
};