Posted by Angel on .
a client comes to you for an investment advice on his 500,000 winnings from the lottery. he has been offered the following options. what would be the best option 6% compounded interest quarterly for 5 years or 8% compounded annually for 5 years or 14.5% simple interest for 10 years. Explain which one would be the better choice
You need to know the inflation rate, because you need to compute the present value of future $.
Then, you also need to know the plans for the money the client has..are they long term or short term, and what future requirements and the timing for disbursement is needed.