Olivia plans to have $1 000 000 in her RRSP at her retirement at the age of 60. How long will it take her to accumulate $1 000 000 in an RRSP if the first quarterly contribution of $2000 is made today and RRSP is expected to earn 8% compounded quarterly?

Question

Quizplus · Accepted Answer

The future value of an annuity formula is used to calculate the time needed to reach $1,000,000 with quarterly contributions of $2000 at an 8% annual interest rate compounded quarterly. Solving for the time gives approximately 30 years and 3 months.

Olivia Plans to Have $1 000 000 in Her RRSP