Growing Annuity Your job pays you only once a year for all the work you did over the previous 12 months. Today, 31 December, you just received your salary of £100,000, and plan to spend all of it. However, you have also decided to join the company’s employee pension scheme. Under the very generous scheme, your company contributes

£2 for every £1 that you pay into the pension. You have decided that one year from today you will begin paying 2 per cent of your annual salary into the pension in which you are guaranteed to earn 8 per cent per year. Your salary will increase at 4 per cent per year throughout your career. How much money will you have on the date of your retirement 40 years from today?