Financial Legacy Calculator

This calculator projects your estate's future value by compounding two separate streams: your current net worth grows at your assumed annual return over the years remaining, and your annual savings are treated as a fixed-payment (ordinary) annuity — the same dollar amount contributed at the end of each year, not one that increases over time — and compounded the same way. Adding those two future values together gives a projected total estate. Anything above the federal estate tax exemption (defaulted from a live reference-data source and editable) is taxed at a flat 40% — the top federal estate tax rate — to produce an estimated tax bill and the net amount that actually passes to your heirs. The calculator then models a gifting strategy: it multiplies the current annual gift tax exclusion (also pulled from reference data) by your number of projected years to estimate total lifetime gifting capacity, subtracts that from the projected estate, and recalculates the 40% tax on the smaller, gifted-down estate.

The difference between the original and reduced tax bills is reported as your tax savings from gifting. Keep the simplifications in mind: applying a flat 40% rate above the exemption is a useful approximation but real federal estate tax is graduated below that ceiling, and it ignores state estate/inheritance taxes, portability of a deceased spouse's unused exemption, and step-up in cost basis, all of which materially change real-world outcomes. The gifting math also assumes you consistently gift the maximum annual exclusion to a single recipient every year without ever varying it for inflation adjustments, marital gift-splitting, or multiple recipients — a real gifting plan would model those separately. Use this as a directional planning tool, not a substitute for an estate attorney or CPA.