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At your first job you take advantage of an employer match program in which your employer will match up to 5% of your salary in a retirement savings plan if you also contribute 5%. Assume that your average salary over 5 years is $75,000, how much will you have saved in five years using a fund that pays 4% annual interest rate. Assume you only did 3% of your salary as retirement plan contribution. How much will you have in the fund, also 4%, after 5 years? Recalculate using a fund that pays 8%.

At your first job you take advantage of an employer match program in which your employer will match up to 5% of your salary in a retirement savings plan if you also contribute 5%. Assume that your average salary over 5 years is $75,000, how much will you have saved in five years using a fund that pays 4% annual interest rate. Assume you only did 3% of your salary as retirement plan contribution. How much will you have in the fund, also 4%, after 5 years? Recalculate using a fund that pays 8%.

Personal Finance
Personal Finance
13th Edition
ISBN:9781337669214
Author:GARMAN
Publisher:GARMAN
Chapter2: Career Planning
Section: Chapter Questions
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At your first job you take advantage of an employer match program in which your employer will match up to 5% of your salary in a retirement savings plan if you also contribute 5%. Assume that your average salary over 5 years is $75,000, how much will you have saved in five years using a fund that pays 4% annual interest rate. Assume you only did 3% of your salary as retirement plan contribution. How much will you have in the fund, also 4%, after 5 years? Recalculate using a fund that pays 8%.
Transcribed Image Text:At your first job you take advantage of an employer match program in which your employer will match up to 5% of your salary in a retirement savings plan if you also contribute 5%. Assume that your average salary over 5 years is $75,000, how much will you have saved in five years using a fund that pays 4% annual interest rate. Assume you only did 3% of your salary as retirement plan contribution. How much will you have in the fund, also 4%, after 5 years? Recalculate using a fund that pays 8%.
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