Question

Assume you plan to retire in 35 years. If you invest $180.00 per month in the broad U.S. equity market and earn annual returns of 9.5% over that period, how much money will you have accumulated on the day you plan to retire?

Answer 1

You would accumulate approximately $1,153,225.99 by the day you plan to retire.

Step-by-step explanation:

In this case, the monthly investment (P) is $180.00, the annual interest rate (r) is 9.5% (or 0.095 as a decimal), and the number of months (n) is 35 years multiplied by 12 months per year, which equals 420 months.

Let's calculate the accumulated amount:

A = $180.00 * (1 + 0.095)^420

A ≈ $1,087,454.66