Question

Jimmy wants to have $1,000,000 on the day he retires (34 years from now). he is planning on earning 10.0% from his investments. how much will he need to invest per month, in order to reach his goal?

Answer 1

To reach his goal of $1,000,000 in 34 years, Jimmy needs to invest approximately $143.16 per month.

Step-by-step explanation:

To calculate how much Jimmy needs to invest per month to reach his goal of $1,000,000 in 34 years, we can use the formula for compound interest. The formula is A = P(1 + r/n)^(nt), where A is the future amount, P is the principal (amount invested per month), r is the annual interest rate, n is the number of times interest is compounded per year, and t is the number of years. In this case, Jimmy wants to earn a 10% return, so the rate is 0.10, and he wants to invest on a monthly basis, so n is 12. Plugging the values into the formula, we have 1,000,000 = P(1 + 0.10/12)^(12*34). Solving for P gives us P ≈ $143.16.