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| Contributions | Interest compounded | Future value | ||
| Bob | 1 up to 13 | $2,000 | 7% | $237, 866.85 |
| Lisa | 13 up to 46 | $2,000 | 7% | $375, 637.00 |
| Totals | 1 up to 46 | $613,503.85 |
By evaluating both investment plans, it is evident that Lisa’s retirement balance is greater compared to Bob’s by $137,770.18. This is due to the fact that she began saving as early as age 21 up to when she was 32 whereas Bob started investing at 32 years and finally by 65 years. Hence, Lisa grew her annuity amount over a longer duration. In conclusion, what matters in investment is the duration and not the contribution towards the investment.
