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Christopher Phelps
Christopher Phelps, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 2710
Experience:  CPA, CFP, PFS, Tax Practitioner 21 Years, Member AICPA/CSCPA Tax/Financial Planning Committee Member
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How much will one million dollars be worth in twenty years

Customer Question

How much will one million dollars be worth in twenty years in todays money?
Submitted: 11 years ago.
Category: Tax
Expert:  Christopher Phelps replied 11 years ago.

Your answer depends on the anticipated rate of return at which it would be invested as well as the rate of compunding (i.e. annually, monthly, daily). You also appear to be asking a second question which is what would $1,000,000 received 20 years from now be worth, the answer to which depends on the discount rate used (i.e. inflation or some other rate).

For example, $1MM invested today at 5% compunded annually at the end of the year would be worth $2,653,297.71. Alternatively, it would take an investment of $376,889.48 invested at 5% compounded annually to generate $1,000,000 20 years from now.

Do you have specific assumptions regarding discount rates and compunding periods?