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Question 5.12: Only 18,262.5 Days to Retirement You would like to retire in...

Only 18,262.5 Days to Retirement

You would like to retire in 50 years as a millionaire. If you have $10,000 today, what rate of return do you need to earn to achieve your goal?

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The future value is $1,000,000. The present value is $10,000, and there are 50 years until payment. We need to calculate the unknown discount rate in the following:
$10,000 = $1,000,000/(1+r)^{50}
(1+r)^{50} = 100
The future value factor is thus 100. You can verify that the implicit rate is about 9.65 percent.

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