Bradley invested an average of $550 per month since age 49 in various securities for his retirement savings. His investments averaged a 7% annual rate of return until he retired at age 73. Given the same monthly investment and rate of return, how much more would Bradley have in his retirement savings had he started investing at age 40? Assume monthly compounding.

Question

anonymous · Answer

@agent0smith

anonymous · Answer

$440,088.67

 $63,558.00

 $1,344,425.69

 $282,480.00

And if someone could explain how to do the problem I'd be really grateful :)

anonymous · Answer

@ParthKohli @wolfe8 would you guys be able to help me understand how to do this? It's financial algebra and my online class does not explain this stuff very well.

parthkohli · Answer

Do you understand compounding of an amount?

parthkohli · Answer

If not so, I'll start from the beginning and progress to the formula.

anonymous · Answer

No I don't. That would be exactly what I need if you don't mind?

anonymous · Answer

Um I could really use help now because I have school in less than an hour.