You have just turned 25 years old and plan to retire at 65. Your annual salary is $100,000 and will remain the same until retirement. Your employer contributes 10% of your annual salary to your superannuation at the end of each year. If you invest into a balanced fund and earn 8% p.a., how much money will be saved up at retirement?

You find an insurance policy where you can pay $200 at the beginning of every month for 12 months or $2360 upfront. If you can borrow at a rate of 5% per annum compounded monthly, is it cheaper for you to pay upfront or by the month?

Answer rating: 100% (QA)

To calculate how much money will be saved up at retirement we can use the future value of an annuity formula to find the value of the contributions made to the superannuation fund over the 40year peri... View the full answer