Question

Francine currently has $65,000 in her 401k account at work, and plans to contribute $9,000 each year for the next 20 years. How much will she have in the account in 20 year, if the account averages a 6% annual return?

Answer 1

Francine will have approximately $189,906 in her 401k account in 20 years.

Step-by-step explanation:

To calculate how much Francine will have in her 401k account in 20 years, we can use the formula for compound interest. The formula for compound interest is A = P(1+r)^t, where A is the final amount, P is the principal amount (initial investment), r is the annual interest rate, and t is the number of years. In this case, Francine's initial investment is $65,000, the annual interest rate is 6% (0.06), and the number of years is 20. Plugging these values into the formula, we get A = 65,000(1+0.06)^20. Evaluating this expression gives us A ≈ $189,906. So, Francine will have approximately $189,906 in her 401k account in 20 years.