Human Life Value Calculator

How it is calculated

The tool takes the part of a person's income that supports others and finds what that stream of money is worth today.

net contribution = income × (1 − consumption % ÷ 100)
human life value = net contribution × (1 − (1 + r)−n) ÷ r
undiscounted total = net contribution × n

Income is the annual figure in dollars and must be above zero; the consumption share is the percentage of it the person spends on themselves (0 to 100; you may also count taxes there); n is the years left to retirement (above 0, up to 100) and r the discount rate as a decimal. Income is assumed flat: there is no raise or inflation input, and payments arrive at the end of each year. At a 0% discount rate the value equals the undiscounted total. A consumption share above 100, a rate of −100% or lower, or an empty field gives no result. Savings, debts and benefits are not subtracted.

Common mistakes

• Expecting the tool to include pay rises. Income is held constant for all years, so for a young person with rising pay the result understates the value, while a rate that is too low overstates it.
• Using the discount rate as the inflation rate. The rate is what the money could earn when invested; a higher rate gives a lower value, and 0% gives the plain total.
• Leaving the discount rate empty, thinking it means zero. Type 0 explicitly, or the tool shows no result.
• Entering take-home and gross income inconsistently. If you enter gross pay, taxes are not taken out unless you include them in the consumption percentage.
• Setting the consumption share to 0 or 100 as a quick test. 0 treats the entire income as contributed and 100 gives a value of zero; neither is realistic for a family.