Future Value of Periodic Investments

Required

1

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 monthly into the account. How much money will be in the account after 15 years?

What value will you use for P?

Required

1

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?

What value will you use for r?

Required

1

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?

What value will you use for n?

Required

1

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?

What value will you use for t?

Required

1

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account.

How much money will be in the account after 15 years?

Required

1

Suppose that person instead chose a bank account with a low interest rate such as the measly 0.01% that Bank of America will pay out. The account still compounds interest daily and this person still deposits $25 daily into the account.

How much money will be in the account after 15 years?

Required

1

How much MORE is in the account with the higher interest rate? (Compare your answers from #5 and #6)

Required

1

It might sound crazy but the best time to start planning for retirement is actually TODAY. Let's suppose you are 16 and deposit $20 in an account monthly with a 2.0% interest rate compounded monthly, such as Citibanks. You plan to continue this deposit until you are 60 so for 44 years. How much will your final balance be in 44 years? (Assuming the interest rate is fixed)

Required

1

How much money did YOU ultimelty put into the account?

Required

1

How much money did you make in INTEREST!

Required

1

In the previous scenario, who contributed more to the account after 44 years, you or the bank?

Hopefully you can see the power of time.  Even if you do not have a lot of money to save right now, the best thing you can do is at least open a savings account or two (or three), to begin planting the power of time.

A few High yield savings options:
https://www.investopedia.com/articles/pf/09/high-yield-savings-account.asp

I personally have a Citibank savings, a Capital one savings and a PNC savings.
Remember, find yourself accounts that have NO monthly fees.

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 monthly into the account. How much money will be in the account after 15 years?What value will you use for P?

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?What value will you use for r?

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?What value will you use for n?

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?What value will you use for t?

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?

Suppose that person instead chose a bank account with a low interest rate such as the measly 0.01% that Bank of America will pay out. The account still compounds interest daily and this person still deposits $25 daily into the account. How much money will be in the account after 15 years?

How much MORE is in the account with the higher interest rate? (Compare your answers from #5 and #6)

How much money did YOU ultimelty put into the account?

How much money did you make in INTEREST!

In the previous scenario, who contributed more to the account after 44 years, you or the bank?

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 monthly into the account. How much money will be in the account after 15 years?

What value will you use for P?

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?

What value will you use for r?

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?

What value will you use for n?

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account. How much money will be in the account after 15 years?

What value will you use for t?

Suppose someone wants to start depositing money into a savings account. They open an account with Citzens bank that pays 2.1% interest compounded daily. This person deposits $25 daily into the account.

How much money will be in the account after 15 years?

Suppose that person instead chose a bank account with a low interest rate such as the measly 0.01% that Bank of America will pay out. The account still compounds interest daily and this person still deposits $25 daily into the account.

How much money will be in the account after 15 years?