Question

Bob and Cindy are the same age. At age 25 Cindy began saving $2,000 a year while Bob saved nothing. At age 50, Bob realized that he needed money for retirement and started saving $4,000 per year while Cindy kept saving her $2,000. Now they are both 75 years old. Who has the most money in his or her retirement account?

Answer 1

Answer:

Both will save the equal amount of money at the age of 75 years

Explanation:

Given:

Amount saved by Cindy per year = $2,000

Amount saved by Bob each year = $4,000

Now,

Cindy started saving at the age of 25 and till the age of 75

thus,

The total number of years for which Cindy saved = 75 - 25 = 50 years

Therefore,

The total amount saved by the Cindy

= Amount saved each year × Total number of years

= $2,000 × 50

= $100,000

and,

Bob  started saving at the age of 50 and till the age of 75

thus,

The total number of years for which Bob saved = 75 - 50 = 25 years

Therefore,

The total amount saved by the Bob

= Amount saved each year × Total number of years

= $4,000 × 25

= $100,000

Hence, Both will save the equal amount of money at the age of 75 years