answer the question below

CHAPTER10 Investment Calculator
INSTRUCTOR’S GUIDE
Activity:
Objective
The purpose of this activity is for students to understand the impact of compound
interest.
Instructor Directions
Hand out the student activity sheet and direct students to the investment calculator found at www.foundationsU.
com. Ask students to calculate what their investment will be worth if they invest $500 per month during their
entire working lifetime (age 25 to 65 = 40 years). Specific directions are as follows:
1. Begin with $1,000 in your current investment.
2. Contribute $500 per month for the next 40 years.
3. Try three different rates of return (8%, 12%, and 15%).
4. How much is each investment worth after 40 years of investing?
Answers:
8% return = $1,781,414
12% return = $6,059,861
15% return = $16,090,591
Suggested tips to try:
1. How much could you save if you gave up pizza, eating out for lunch, coffee or soda?
2. Try other interest rates.
3. Try other monthly contribution amounts.
F O U N D A T I O NS I N P E R S O N A L F I N A N C E C O L L E G E E D I T I O N
CHAPTER 10: Investments
CHAPTER
10 Investment Calculator
Activity:
Name_______________________________________
Date_____________________________
Objective
The purpose of this activity is to understand the impact of compound interest.
Directions
Go to the investment calculator found at www.foundationsU.com and calculate what your investment will be worth
if you invest $500 per month during your entire working lifetime (age 25 to 65 = 40 years). Specific directions are as
follows:
1. Begin with $1,000 in your current investment.
2. Contribute $500 per month for the next 40 years.
3. Try three different rates of return (8%, 12%, and 15%).
4. How much is each investment worth after 40 years of investing?
8% is worth $
12% is worth $
15% is worth $
F O U N D A T I O NS I N P E R S O N A L F I N A N C E C O L L E G E E D I T I O N
CHAPTER 10: Investments