Question

If I put $2,000 in a mutual fund at age 20 for ten years and stop,...

If I put $2,000 in a mutual fund at age 20 for ten years and stop, and then hold until 75. how much will I have if I expect a return of 8.1%. What if I wait til age 30 and put $3,000 every year in the bank and save until age 75, with the same rate. Will I have more or less?

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
Particulars Mutual fund Bank account
Annuity payment           2,000.00           3,000.00
× FVAF          14.55554       398.49289
Future value         29,111.08 1,195,478.67
× FVF for 45 years $33.28
Future value in retirement      968,756.15 1,195,478.67

Answer is more by = 1,195,478.67 - 968,756.15 = 226,722.52

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
If an investor age 25 deposits $100 a month in a mutual fund with an annualized...
If an investor age 25 deposits $100 a month in a mutual fund with an annualized return of 10% a year, he'll have about $640,000 at age 65. If he waits until age 40 to start saving, how much will he have to deposit each month to have the same amount at age 65? A. $150 B. $225 C. $475 D. $800
Starting at age 20, you start saving for retirement early and put $2,600 yearly into your...
Starting at age 20, you start saving for retirement early and put $2,600 yearly into your retirement savings account throughout your 20s. However, when you turn 30, you stop contributing since you have bought a home and started a family and have no additional money left over to save for retirement. If you receive an average annual return of 6 ​percent compounded annually, how much will you have in your retirement savings account by age 67​?
Fred and Louise are 38 years old and plan on retiring at age 67 and expect...
Fred and Louise are 38 years old and plan on retiring at age 67 and expect to live until age 95. Fred currently earns $150,000 and they expect to need $100,000 in retirement. Louise is a stay at home mom. They also expect that Social Security will provide $30,000 of benefits in today’s dollars at age 67. He has been saving $17,000 annually in his 401(k) plan. Their daughter, Ann, who was just born, is expected to go to college...
Ashley began saving $5,000 per year from age 25 to age 35 (ten years) and then...
Ashley began saving $5,000 per year from age 25 to age 35 (ten years) and then invested the funds for another 30 years. Teeto began saving at age 35 and saved $5,000 each year until he retired at age 65 (30 years). Which of the following statements is correct assuming they invested their funds at 7 percent? Ashley and Teeto will have the same amount of money accumulated at age 65. Ashley will have 29% more accumulated than Teeto at...
You are 35 years old today and want to plan for retirement at age 65. You...
You are 35 years old today and want to plan for retirement at age 65. You want to set aside an equal amount every year from now to retirement. You expect to live to age 85 and want to withdraw a fixed amount each year during retirement that at age 65 will have the same purchasing power as $83,697 has today. You plan on withdrawing the money starting the day you retire. You have not saved any money for retirement....
You are 43 years old today and want to plan for retirement at age 65. You...
You are 43 years old today and want to plan for retirement at age 65. You want to set aside an equal amount every year from now to retirement. You expect to live to age 95 and want to withdraw a fixed amount each year during retirement that at age 65 will have the same purchasing power as $98,093 has today. You plan on withdrawing the money starting the day you retire. You have not saved any money for retirement....
You are 44 years old today and want to plan for retirement at age 65. You...
You are 44 years old today and want to plan for retirement at age 65. You want to set aside an equal amount every year from now to retirement. You expect to live to age 96 and want to withdraw a fixed amount each year during retirement that at age 65 will have the same purchasing power as $94,725 has today. You plan on withdrawing the money starting the day you retire. You have not saved any money for retirement....
You are 45 years old and planning to retire at age 65. You expect to live...
You are 45 years old and planning to retire at age 65. You expect to live until age 85. Your retirment investment earns 9% per year. You want to guarentee that you will withdrawl 15000 per month during retiremnent. You expect that inflation will be 3% per year including years in retirement. How much must you save per month until retirment to fund your plan. HINT: Your retirment withdrawl will increase every month at the inflation rate of 3%. The...
I don't really need the answer since I have the answer. I just need to know...
I don't really need the answer since I have the answer. I just need to know how to solve them, like what buttons to click on the financial calculator. Please go based on the answer I have provided. Don't use r or c to explain. Only explain using n, i, pv, fv, pmt. 1.)You are 40 years old today and want to plan for retirement at age 65. You want to set aside an equal amount every year from now...
I- (6 pts) Suppose you have some money to invest-for simplicity, $1-and are planning to put...
I- (6 pts) Suppose you have some money to invest-for simplicity, $1-and are planning to put a fraction into a stock market mutual fund and the rest ( ), into a bond mutual fund. Suppose that a $1 invested in a stock fund yields ??after one year and a $1 invested in a bond fund yields . ?? and are random variables with expected value of 9% and 6% respectively, and standard deviation of 5% and 3% respectively. The correlation...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT