Cassandra Sets Up a Savings Plan for Her Retirement

Essay

Cassandra sets up a savings plan for her retirement. She plans to make a quarterly payment of $3250 into a savings account that earns 11% per year, compounded quarterly. After 3 years, she will have an option to continue making $3250 quarterly payments or to switch to an annual savings plan that earns higher interest of 11.25% per year and requires annual payments of $13,000. If she plans to retire 13 years from now, which option will offer more money in the savings plan at that time?