A usefful personal and business investment site with in-depth detail on personal financial planning. After reading a March 19,2009 , article"Preparing a Portfolio for Retirement," Arlene Supple, 47 years old, is evaluating her retirement portifolio. She paid her house off in anticipation of an early retirement. In addition, she has invested wisely in her company 's 401k, a Roth IRA, municipal bonds, and certicates of deposit. She has amassed 287,000 in her diversified portfolio. Today, she has the opportunity to deposit her money at 4.0% compounded quartly. If she retires at 54 years old, how much will her investment be worth?

To calculate how much Arlene's investment will be worth at retirement, we need to use the compound interest formula:

A = P(1 + r/n)^(nt)

Where:
A = the future value of the investment
P = the principal amount (initial investment)
r = the annual interest rate (expressed as a decimal)
n = the number of times that interest is compounded per year
t = the number of years

Based on the information given, Arlene's initial investment (principal) is $287,000, the annual interest rate (r) is 4.0% (or 0.04 as a decimal), and the interest is compounded quarterly (n = 4).

Now, we need to calculate the number of years (t) until Arlene retires. Given that she is currently 47 years old and plans to retire at 54, the number of years until retirement is:

t = 54 - 47 = 7 years

Plugging these values into the formula, we get:

A = $287,000(1 + 0.04/4)^(4*7)

Simplifying the equation further, we have:

A = $287,000(1 + 0.01)^28

Using a calculator or a spreadsheet, we can calculate the final value of Arlene's investment:

A ≈ $287,000(1.01)^28

Calculating this, we find that Arlene's investment will be worth approximately $357,327.62 at retirement.