Question

ou just won $80,000 on a scratch-off lottery ticket. You plan to save the money in a retirement account expected to return 9% per year. If you intend to retire in 45 years, how much are these lottery winnings expected to be worth when you retire?

Answer 1

Answer: $3,866,182.89

Explanation:

The winnings in 45 years are the future value of the $80,000 that you just won based on the return rate of 9%.

Future Value = Present Value ( 1 + return) ^ number of years

= 80,000 ( 1 + 0.09) ⁴⁵

= $3,866,182.89

Lottery winnings will be worth $3,866,182.89 when you retire.