Annual Increase of Contributions is the default cost of money lost due to the ongoing impact of inflation. Since the buying power of money declines in an inflationary environment, most cash-flows in a Target-Map default to the Annual Increase of Contributions. 

The importance of the Annual Increase of Contributions is that it directly impacts the Additional Contributions to Fund monthly dollar amount by naturally inflating required savings (if any) in a Target-Map annually. (See below) It does not affect the dollar amount of deficit to fund or surplus.

The Annual Increase of Contributions default rate can be set within the Target-Map Preferences to be applied to all Target-Map templates. It can also be customized within specific Target-Maps. Modifications to the default values are applied to new Target-Maps moving forward and not to previously created Target-Maps.
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Tags: monthly, month, rate, save, extra, savings, inflation, COLA

6/2022