How old are you 21 You have chosen to invest 15000 into a lo

How old are you? 21

You have chosen to invest $15,000 into a long-term retirement account yielding an interest rate of 7.2% compounded monthly. How much money will you have if you retire at the age of …

a) 65 years?

b) 70 years?

c) What are your thoughts?

Solution

A= P(1+(r/n))^nt

a. t=65-21= 44 years

A= 15000(1+0.072/12)^44*12= $353041

b. t= 70-21= 49 years

A=15000(1+0.072/12)^49*12= $505480