Carlos Menendez is planning to invest $3,500 every year for the next six years in an investment paying 12 percent annually. What will be the amount he will have at the end of the six years?

Carlos Menendez plans to invest every year $3,500 for six years into an investment that pays 12 percent per year. We can use the power of compounding to calculate how much he’ll have at the end by determining his current value. This can be done by taking each year’s payments and discounting them back to today’s dollar value using a rate that reflects the time-value of money (i.e., 12%). This will show that Carlos invested $21,000 over the 6 year period.

After 6 years, the amount he has accumulated would be approximately $48,392, assuming that there are no withdrawals made and funds are invested at a rate of interest of 12 percent. This calculation is based on simple interest – i.e., not factoring in any reinvestment or compounding effects which could increase returns even further; however given that Carlos is only investing once per year this should not affect his ending balance significantly as there are few opportunities for capital appreciation due to limited reinvestment opportunities.

Nevertheless though it is evident from this analysis that Carlos’ decision to invest consistently over a longer term period will pay off quite handsomely; with just under $50k after 6 years this strategy should provide a solid return on his initial outlay while also helping him benefit from tax deferral advantages associated with retirements savings accounts like 401ks or IRAs.