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No, my assumptions are wrong then - what does "20" represent here? and does the "^" symbol represent the power function?
by colordrops 5y ago
No, my assumptions are wrong then - what does "20" represent here? and does the "^" symbol represent the power function?
- sp332 5y agoYeah sorry for being cryptic. It's 20 years compounding at 7% per year. Scenario one: take your starting investment, subtract 20% for taxes, then do the compound growth. Scenario two: take your whole starting investment, do the compound growth, then subtract 20% of the result. It's totally possible that I missed modeling some part of the situation that somehow makes more money from the Roth way of doing things. But the models above produce the same results.