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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?

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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

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