Investment Method
can I ask which of the investment method below in accumulating wealth is better?
Option 1:
deposit P dollar at the end of every month for 25 years at a dividend rate of 5% per annum.
Option 2:
purchase a house by loan amounting 250,000 dollar for 25 years with a nominal interest rate of 4.5% convertible monthly. The loan paid in monthly level of payments. The house value is increasing at yield of 3% per annum. Two years later, he is making money by renting his house at 700 dollar per month paying at the beginning of the month until the housing loan has been paid. The level monthly house rents are to be reinvested at dividend rate of 5% per annum.
finance actuarial-science
asked Dec 3 '18 at 10:00
Newbie
123
add a comment |
can I ask which of the investment method below in accumulating wealth is better?
Option 1:
deposit P dollar at the end of every month for 25 years at a dividend rate of 5% per annum.
Option 2:
purchase a house by loan amounting 250,000 dollar for 25 years with a nominal interest rate of 4.5% convertible monthly. The loan paid in monthly level of payments. The house value is increasing at yield of 3% per annum. Two years later, he is making money by renting his house at 700 dollar per month paying at the beginning of the month until the housing loan has been paid. The level monthly house rents are to be reinvested at dividend rate of 5% per annum.
finance actuarial-science
asked Dec 3 '18 at 10:00
Newbie
123
What have you tried to calculate the wealth at option 1? It doesn´t look very hard.
– callculus
Dec 3 '18 at 19:21
add a comment |
can I ask which of the investment method below in accumulating wealth is better?
Option 1:
deposit P dollar at the end of every month for 25 years at a dividend rate of 5% per annum.
Option 2:
purchase a house by loan amounting 250,000 dollar for 25 years with a nominal interest rate of 4.5% convertible monthly. The loan paid in monthly level of payments. The house value is increasing at yield of 3% per annum. Two years later, he is making money by renting his house at 700 dollar per month paying at the beginning of the month until the housing loan has been paid. The level monthly house rents are to be reinvested at dividend rate of 5% per annum.
finance actuarial-science
asked Dec 3 '18 at 10:00
Newbie
123
can I ask which of the investment method below in accumulating wealth is better?
Option 1:
deposit P dollar at the end of every month for 25 years at a dividend rate of 5% per annum.
Option 2:
purchase a house by loan amounting 250,000 dollar for 25 years with a nominal interest rate of 4.5% convertible monthly. The loan paid in monthly level of payments. The house value is increasing at yield of 3% per annum. Two years later, he is making money by renting his house at 700 dollar per month paying at the beginning of the month until the housing loan has been paid. The level monthly house rents are to be reinvested at dividend rate of 5% per annum.
finance actuarial-science
finance actuarial-science
asked Dec 3 '18 at 10:00
Newbie
123
asked Dec 3 '18 at 10:00
Newbie
123
edited Dec 3 '18 at 10:30
asked Dec 3 '18 at 10:00
Newbie
123
asked Dec 3 '18 at 10:00
Newbie
123
asked Dec 3 '18 at 10:00
Newbie
123
123
What have you tried to calculate the wealth at option 1? It doesn´t look very hard.
– callculus
Dec 3 '18 at 19:21
add a comment |
What have you tried to calculate the wealth at option 1? It doesn´t look very hard.
– callculus
Dec 3 '18 at 19:21
What have you tried to calculate the wealth at option 1? It doesn´t look very hard.
– callculus
Dec 3 '18 at 19:21
What have you tried to calculate the wealth at option 1? It doesn´t look very hard.
– callculus
Dec 3 '18 at 19:21
add a comment |
0
active
oldest
votes
Your Answer
StackExchange.ifUsing("editor", function () {
return StackExchange.using("mathjaxEditing", function () {
StackExchange.MarkdownEditor.creationCallbacks.add(function (editor, postfix) {
StackExchange.mathjaxEditing.prepareWmdForMathJax(editor, postfix, [["$", "$"], ["\\(","\\)"]]);
});
});
}, "mathjax-editing");
StackExchange.ready(function() {
var channelOptions = {
tags: "".split(" "),
id: "69"
};
initTagRenderer("".split(" "), "".split(" "), channelOptions);
StackExchange.using("externalEditor", function() {
// Have to fire editor after snippets, if snippets enabled
if (StackExchange.settings.snippets.snippetsEnabled) {
StackExchange.using("snippets", function() {
createEditor();
});
}
else {
createEditor();
}
});
function createEditor() {
StackExchange.prepareEditor({
heartbeatType: 'answer',
autoActivateHeartbeat: false,
convertImagesToLinks: true,
noModals: true,
showLowRepImageUploadWarning: true,
reputationToPostImages: 10,
bindNavPrevention: true,
postfix: "",
imageUploader: {
brandingHtml: "Powered by u003ca class="icon-imgur-white" href="https://imgur.com/"u003eu003c/au003e",
contentPolicyHtml: "User contributions licensed under u003ca href="https://creativecommons.org/licenses/by-sa/3.0/"u003ecc by-sa 3.0 with attribution requiredu003c/au003e u003ca href="https://stackoverflow.com/legal/content-policy"u003e(content policy)u003c/au003e",
allowUrls: true
},
noCode: true, onDemand: true,
discardSelector: ".discard-answer"
,immediatelyShowMarkdownHelp:true
});
}
});
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
StackExchange.ready(
function () {
StackExchange.openid.initPostLogin('.new-post-login', 'https%3a%2f%2fmath.stackexchange.com%2fquestions%2f3023862%2finvestment-method%23new-answer', 'question_page');
}
);
Post as a guest
Required, but never shown
0
active
oldest
votes
0
active
oldest
votes
active
oldest
votes
active
oldest
votes
Thanks for contributing an answer to Mathematics Stack Exchange!
- Please be sure to answer the question. Provide details and share your research!
But avoid …
- Asking for help, clarification, or responding to other answers.
- Making statements based on opinion; back them up with references or personal experience.
Use MathJax to format equations. MathJax reference.
To learn more, see our tips on writing great answers.
Some of your past answers have not been well-received, and you're in danger of being blocked from answering.
Please pay close attention to the following guidance:
- Please be sure to answer the question. Provide details and share your research!
But avoid …
- Asking for help, clarification, or responding to other answers.
- Making statements based on opinion; back them up with references or personal experience.
To learn more, see our tips on writing great answers.
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
StackExchange.ready(
function () {
StackExchange.openid.initPostLogin('.new-post-login', 'https%3a%2f%2fmath.stackexchange.com%2fquestions%2f3023862%2finvestment-method%23new-answer', 'question_page');
}
);
Post as a guest
Required, but never shown
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
Sign up or log in
StackExchange.ready(function () {
StackExchange.helpers.onClickDraftSave('#login-link');
});
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Sign up using Google
Sign up using Facebook
Sign up using Email and Password
Post as a guest
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
Required, but never shown
What have you tried to calculate the wealth at option 1? It doesn´t look very hard.
– callculus
Dec 3 '18 at 19:21