3.2 Anticipated Earnings: Investments and Savings MDM

Transcription

1 3.2 Anticipated Earnings: Investments and Savings MDM

2 WARM UP W1) You have a rich uncle who will double the money in your bank account each time you earn an A on a math test. If you earn an A on 12 math tests, how much money is in your bank account if it started at $20. REMINDER: P 1 + r n

3 WARM UP W1) You have a rich uncle who will double the money in your bank account each time you earn an A on a math test. If you earn an A on 12 math tests, how much money is in your bank account if it started at $20. $ = $81,920 REMINDER: P 1 + r n

4 OBJECTIVES Discuss realistic returns on investments Find the value of investments after a set time has passed

5 ANTICIPATED EARNINGS The APY (Annual Percentage Yield) is a percentage rate that reflects the total amount of interest paid on the account for a 365-day period. A savings account is an account maintained by a retail financial institution (typically a bank) that pays interest to the holder.

6 SAVINGS ACCOUNT FINANCIAL INSTITUTION SAVINGS ACCOUNT APY Wells Fargo % Alpine Credit Union % Capital One 0.75%

7 SAVINGS ACCOUNT FINANCIAL INSTITUTION SAVINGS ACCOUNT APY Wells Fargo % Alpine Credit Union % Capital One 0.75% A) If you place $10,000 into a savings account, find the amount of money that will be in that account after 20 years for WELLS FARGO.

8 SAVINGS ACCOUNT FINANCIAL INSTITUTION SAVINGS ACCOUNT APY Wells Fargo % Alpine Credit Union % Capital One 0.75% A) If you place $10,000 into a savings account, find the amount of money that will be in that account after 20 years for WELLS FARGO. $10, = $10,020.02

9 SAVINGS ACCOUNT FINANCIAL INSTITUTION SAVINGS ACCOUNT APY Wells Fargo % Alpine Credit Union % Capital One 0.75% B) If you place $10,000 into a savings account, find the amount of money that will be in that account after 20 years for ALPINE CREDIT UNION.

10 SAVINGS ACCOUNT FINANCIAL INSTITUTION SAVINGS ACCOUNT APY Wells Fargo % Alpine Credit Union % Capital One 0.75% B) If you place $10,000 into a savings account, find the amount of money that will be in that account after 20 years for ALPINE CREDIT UNION. $10, = $10,060.17

11 SAVINGS ACCOUNT FINANCIAL INSTITUTION SAVINGS ACCOUNT APY Wells Fargo % Alpine Credit Union % Capital One 0.75% C) If you place $10,000 into a savings account, find the amount of money that will be in that account after 20 years for CAPITAL ONE.

12 SAVINGS ACCOUNT FINANCIAL INSTITUTION SAVINGS ACCOUNT APY Wells Fargo % Alpine Credit Union % Capital One 0.75% C) If you place $10,000 into a savings account, find the amount of money that will be in that account after 20 years for CAPITAL ONE. $10, = $11,611.84

13 CERTIFICATE OF DEPOSIT A CD (certificate of deposit) is a time-based financial product commonly sold by banks and credit unions. CDs are similar to savings accounts but with a specific fixed term (time you must keep your money in the CD).

14 CERTIFICATE OF DEPOSIT Capital One CD APY 6 Month 0.40% 9 Month 0.40% 12 Month 0.75% 18 Month 0.90% 24 Month 1.10% 30 Month 1.10% 36 Month 1.10% 48 Month 1.10% 60 Month 1.25%

15 CERTIFICATE OF DEPOSIT Capital One CD APY D) If you invest $10,000 into a CD for 48 months, how much money will you have at the end? 6 Month 0.40% 9 Month 0.40% 12 Month 0.75% 18 Month 0.90% 24 Month 1.10% 30 Month 1.10% 36 Month 1.10% 48 Month 1.10% 60 Month 1.25%

16 CERTIFICATE OF DEPOSIT Capital One CD APY D) If you invest $10,000 into a CD for 48 months, how much money will you have at the end? $10, = $10, Month 0.40% 9 Month 0.40% 12 Month 0.75% 18 Month 0.90% 24 Month 1.10% 30 Month 1.10% 36 Month 1.10% 48 Month 1.10% 60 Month 1.25%

17 STOCKS AND BONDS During the ten year span ending on Sept stocks registered an average annual total return of 8.11%. During that same time bonds had an average annual return of 4.62%.

18 STOCKS AND BONDS Avg Stock: 8.11% Avg Bond: 4.62% E) You invested $10,000 into assorted stocks and $10,000 into assorted bonds 10 years ago. Based on the averages, how much money is in each account today?

19 STOCKS AND BONDS Avg Stock: 8.11% Avg Bond: 4.62% E) You invested $10,000 into assorted stocks and $10,000 into assorted bonds 10 years ago. Based on the averages, how much money is in each account today? STOCK: $10, = $21, BOND: $10, = $15,708.95

20 OBJECTIVES Discuss realistic returns on investments Find the value of investments after a set time has passed

21 HOMEWORK Assignment 3.2 EDPuzzle 3.2