Question of the Day: How much do you need to invest monthly to have $1 million when you retire?
Small savings can add up! But how much is "small" when it comes to retirement?
Answer: $325 monthly
Questions:
- How does $325 per month become $1 million, even though you only contributed a total of $156,000?
- How might your approach to investing in reality might be different from these calculations?
- What is your biggest takeaway for your own finances from this example? Why?
Click here for the ready-to-go slides for this Question of the Day that you can use in your classroom!
Behind the Numbers (Investor.gov):
Use this calculator to help students understand how compounding can grow their investments. For this problem, we assumed an annual return of 8% and that the amount they contribute every month remains constant.
One way to facilitate this activity:
- Students write down their guesses
- Project the investment calculator
- Input a handful of student guesses
- Input the correct answer
- Compare the total contributions to the final investment value
About the Author
Kathryn Dawson
Kathryn (she/her) is excited to join the NGPF team after 9 years of experience in education as a mentor, tutor, and special education teacher. She is a graduate of Cornell University with a degree in policy analysis and management and has a master's degree in education from Brooklyn College. Kathryn is looking forward to bringing her passion for accessibility and educational justice into curriculum design at NGPF. During her free time, Kathryn loves embarking on cooking projects, walking around her Seattle neighborhood with her dog, or lounging in a hammock with a book.
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