Personal Investment Portfolio (One-Time, Vacation, Car, and Retirement)

One-Time Investment

You receive $1500 from friends and family for graduation. You decide to be smart with your money and invest it in a CD (Certificate of Deposit).

  1. Go to bankrate.com and click on CDs rates.
  2. Choose an institution with whom you would like to invest.
  3. Type the name of the institution, interest rate, the compound period, and the initial investment needed
  4. On a word document CREATE the TVM solver table from SAS 5 (you choose how long you want to invest your money – as long as it is AT LEAST 5 years to make your investment worthwhile).
  5. Type a statement about how much money you will have at the end of your investment. Explain why you would or would not choose this investment again and what might give you a better return on your investment?

Word document should be emailed to by the end of the class period on Block Day 4/12-13.

One- Time Investment

Institution:

Interest Rate:

Compound Period:

Initial Investment Needed: $1,500

TVM Solver:

N / Period
I% / Interest rate
PV / Present value
PMT / Payment
FV / Future Value
P/Y / # of payments per year
C/Y / # of periods per year

Vacation

By the end of this activity, you will have done the following:

  1. Researched a dream vacation that you would like to take. (Copy and paste websites as proof for each of the costs)
  2. destination
  3. duration
  4. total cost
  5. plane fair
  6. cost of gas
  7. hotel
  8. tips
  9. entertainment
  10. meals
  11. etc
  12. Go to bankrate.com and click on CD rates.
  13. Choose an investment with whom you would like to invest that is compounded monthly and corresponds to the amount of money you will initially invest.
  14. Type the name of the institution, interest rate, the compound period (monthly), and your initial investment (something reasonable)
  15. On a word document include the vacation information from #1 and CREATE the TVM solver table from SAS 5 and fill out the table twice.
  16. First one: You want to take your vacation in five years. How much will you have to put into your account each month to take the vacation when you want to?
  17. Second one: You know you can put $75 into your investment each month. How long will you have to wait to go on your vacation?

Word document should be emailed to by the end of the class period on Block Day 4/19-20.

Car

  1. Find a vehicle that you would like to purchase and copy/print the proof of the sticker price.
  2. a. Go to bankrate.com

b. At the top, there is a tab that says auto, choose auto loans under compare lenders.

c. Select Change Search. Loan type will be Purchase. Choose only new. Under terms, choose 48 and 60 month terms and update.

d. Select a bank that offers both kinds of loans with no fee (click on Fees and Conditions to see this) and record the interest rate for each loan.

  1. On a word document CREATE the TVM solver table from SAS 5 and fill out the table twice.
  2. First one: over 60 months
  3. Second one: over 48 months
  4. Answer the following questions:
  5. How much money did you actually pay the bank for each loan?
  6. How much money more money did you pay the bank when you took out the loan for the extra year?
  7. How much money could you have saved for each option, if you just paid for the car in cash?

Word document should be emailed to by the end of the class period on Block Day 4/20-21.

Retirement

  1. Calculate your life expectancy using Bankrate.com’s life expectancy calculator.
  2. Subtract 65 (average age of retirement) from that number. This is the estimated number of years you will need to support yourself after retirement.
  3. Based on mysalary.com and reality check, what is the average salary you expect to make?
  4. Calculate 80% of that number. This is the estimated annual income you will need to replace after retirement.
  5. On a word document CREATE the TVM solver table from SAS 5 and calculate the amount of money you will need to save each month if you can invest in a retirement plan that has an average rate of return of 5% compounded monthly. (To find the number of years you will be saving, calculate based on when you will begin your career – if it is right out of high school, use the age you will be when you graduate, etc. and assume that you will be able to retire at age 65).
  6. Answer the following questions:
  7. How much should you take out of each paycheck in order to properly save for retirement?
  8. How much does this amount to each year?
  9. What percentage is this amount of your annual salary?
  10. How does this amount fit into your budget from Reality Check?

Word document should be emailed to by the end of the class period on Block Day 4/20-21.

Retirement

  1. Age you will live to:
  2. Number of years that you will need to support yourself:
  3. Average salary:
  4. 80% of your average salary:

TVM Solver:

N / Period
I% / Interest rate / 5
PV / Present value
PMT / Payment
FV / Future Value
P/Y / # of payments per year
C/Y / # of periods per year