Jane and joan are twins. they both went to work
at age 25 with similar jobs, and at the end of each
year they will be receiving bonuses of $2000.
but there was one (big? ) difference:
jane is conservative and concerned about her
future. her plan is to invest her s2000 bonus each
year in a retirement savings program until age 35,
and then have some fun in life by spending the
remaining bonuses on caribbean vacations until
she retires at 65.
joan, on the other hand, is convinced she should
take opportunities to enjoy life and not be too
concerned about saving for the future early on.
for the first ten years she plans to spend her $2000 bonuses on vacations in the bahamas. at
age 35, she will start saving for her future and from that time on she will invest her $2000
bonuses until she retires at 65.
each sister is proud of her well-thought-out plan, but who will have
your job: investigate what happens to each sister's money over time. check two interest rates:
• conservative long term annual rate: 3.5%
• optimistic long term annual rate: 8%
write a report to the sisters instructing them on the best plan, be sure to point out who invested
more and who had more money at retirement.