Annuity???

Question

The periodic deposit is $3000 at the end of each yr. It is compounded annually 4% for 20 yrs. What is the value of the annuity and the interest?

Answer 1

$92,907.61

http://www.moneychimp.com/calculator/compound_interest_calculator.htm

Of course, part of the "value" is also that it is likely tax deferred and passes to heirs more easily :-)

Answer 2

Annuity's are of very little value to most people. Look at US Gov't bonds, FDIC Insured CD accounts & some AAA corporate bonds.

Actually: A balanced portfolio of stocks & bonds is the best route (just adds more risk for the reward). A twenty year time frame allows you to recover from bad years & get better returns in good years.

BTW: Tax deffered means pay at your earnings rate when due. Capital Gains taxes can be much cheaper (depends on your situation).

Good luck

Answer 3

Annuities are the Worst investment you can possibly make! They pay the HIGHEST commission rates to the sellers and Regardless of what the salesman tells you, they will NEVER beat a portfolio of regular investments (i.e. stocks, mutual funds, bonds etc...)!

Forget the "fuzzy math"! Tell your scumbag insurance agent to go "F" himself!!!

Answer 4

$89,334.24
Total Payments $60,000
Interest $29,334.24

If you got $92,907.61, you started your deposits at the beginning of the period, not at the end