SS - Investing Money Annuities

What is an Annuity?

An annuity is an investment that requires the investor to invest the a given amount at the beginning of each year (time period) for a specific number of years (time periods). Interest is paid at the end of each year (time period) and remain part of the investment.

Annuity Example

$1,000 is invested each year for 4 years and an interest rate of 4% is paid annually.

Exercise: The power of Time

Create a spreadsheet file to contain each of these Scenarios on different sheets.

The shaded cells are formulas.

Scenario #1: Invest Now

Scenario #2: Invest Later

How did that Happen?

Scenario #3: Invest Always

Think about how to create this sheet with re-doing everything!

Scenario #4:  TFSA