Ellen considered saving $10,000 per year for her retirement. Although $10,000 is the most she can save in the…

Ellen considered saving $10,000 per year for her retirement. Although $10,000 is the most she can save in the…

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Ellen considered saving $10,000 per year for her retirement. Although $10,000 is the most she can save in the first year, she expects her salary to increase each year so that she will be able to increase her savings by 5% per year. With this plan, if she earns 10% per year on her savings, how much will Ellen have in her account at age 65 assuming she is currently 35?

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Answer rating: 100% (QA)

To calculate how much Ellen will have in her retirement account at age 65 we can use the concept of compound interest Given that Ellen is currently 35
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