Who Will Win the Retirement Savings Race?

VW vs Lamborghini Retirement Race

This is a race between a lowly Volkswagen and a Lamborghini. The Volkswagen represents a savings vehicle earning a boring but steady 5% interest rate, year in and year out. The Lamborghini represents an investment account generating a more exciting return of 8% annually in every year except for one. The challenge is to help the Volkswagen cross the finish line ahead of the Lamborghini before the race ends in 10 years. Begin by funding an account for the Volkswagen and the Lamborghini by entering an amount in the 1st yellow box. You must then decide in which of the next 10 years the Lamborghini will suffer a 30% loss.

Volkswagen vs. Lamborghini
1

How much will you choose to fund an account for the Volkswagen and the Lamborghini? Click the yellow box to the right, and type in a number between 1 and $9,999,999. Then press ENTER.

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2

Decide in which year the investment account will sustain a 30% loss instead of an 8% gain? Double click the yellow box to the right and type in a number between 1 and 10. Then press ENTER.

3

Since 2000, typical investors lost 45% or more in market meltdowns – twice! It could happen again in 5 yrs, 10 yrs, or even tomorrow. Click in the box to vary the percentage drop. Then press ENTER.

— Volkswagen —
Savings Vehicle

— Lamborghini —
Investment Account

Year

Interest Rate

Year End Balance

Rate of Return

Year End Balance

Year End Difference

1 5% $0 8% $0 $0
2 5% $0 8% $0 $0
3 5% $0 8% $0 $0
4 5% $0 8% $0 $0
5 5% $0 8% $0 $0
6 5% $0 8% $0 $0
7 5% $0 8% $0 $0
8 5% $0 8% $0 $0
9 5% $0 8% $0 $0
10 5% $0 8% $0 $0
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