Sally is going to retire in 40 years. Her starting salary is 80,000. Her employer contributes 12.5% of their salary (i.e 10,000 in the first year) into a Superannuation fund. Contributions are made at the end of the year.

Sally's salary is going to grow at 4.7% per annum and the Superannuation fund will grow at 7.3% per annum.

Summary

Starting Salary: 80,000 Salary Growth: 4.70%

Superannuation Contributions: 12.5% made at end of year Superannuation Growth: 7.3%

a) How much will she have in her superannuation account when she retires in 40 years

b) How much would she have if her contributions were made monthly instead of at the end of the year