Question

You are currently 25 years of age. You have developed a lifetime
budget that includes $50,000 at age 40 for a college fund for your
kids and $25,000 per year for 20 years to supplement your
retirement, the first payment on your 60^{th} birthday and
the last payment on your 79^{th} birthday. You open an
investment account on your 25^{th} birthday that promises
to pay 9% interest compounded annually. You want to deposit equal
annual amounts into the account every year on your birthday,
starting today (your 25^{th} birthday) and continuing until
you are 40 years old (i.e., the last deposit is made on your
40^{th} birthday). How much will each deposit have to be if
you want to meet your financial goals?

Answer #1

You are currently 25 years of age. You have developed a
lifetime budget that includes $50,000 at age 40 for a college fund
for your kids and $25,000 per year for 20 years to supplement your
retirement, the first payment on your 60th birthday and
the last payment on your 79th birthday. You open an
investment account on your 25th birthday that promises
to pay 9% interest compounded annually. You want to deposit equal
annual amounts into the account every...

You are currently 25 years of age. You have developed a lifetime
budget that includes $50,000 at age 40 for a college fund for your
kids and $25,000 per year for 20 years to supplement your
retirement, the first payment on your 60th birthday and the last
payment on your 79th birthday. You open an investment account on
your 25th birthday that promises to pay 9% interest compounded
annually. You want to deposit equal annual amounts into the account
every...

You are currently 25 years of age. You have developed a
lifetime budget that includes $50,000 at age 40 for a college fund
for your kids and $25,000 per year for 20 years to supplement your
retirement, the first payment on your 60th birthday and
the last payment on your 79th birthday. You open an
investment account on your 25th birthday that promises
to pay 9% interest compounded annually. You want to deposit equal
annual amounts into the account every...

You are 40 years old and want to retire at age 60. Each year,
starting one year from now, you will deposit an equal amount into
a savings account that pays 7% interest. The last deposit will be
on your 60th birthday. On your 60th birthday you will switch the
accumulated savings into a safer bank account that pays only 3.5%
interest. You will withdraw your annual income of $120,000 at the
end of that year (on your 61st birthday)...

Happy birthday! You are 30 years old today. You want to retire
at age 60. You want to have
$1,800,000 at retirement. Realistically, you know that the
most that you can save from your 31st birthday until your 50th is
$5,500 per year (you only save on your birthdays!). How much do
you have to save each year from your 51st to your 60th birthday in
order to achieve your retirement goal if you can earn 6% on your...

Today is your 25th birthday, and you want to save $1.1 Million
by your birthday at age 70. If you expect to earn 8% APR compounded
monthly in your retirement account, what constant payment at the
end of each month must you deposit into the account through your
70th birthday in order to reach your retirement savings goal on
your 70th birthday? (Answer to the nearest penny.)

Today is your 25th birthday, and you want to save $2.3 Million
by your birthday at age 70. If you expect to earn 7% APR compounded
monthly in your retirement account, what constant payment at the
end of each month must you deposit into the account through your
70th birthday in order to reach your retirement savings goal on
your 70th birthday? (Answer to the nearest penny.)

You are currently 30 years old. You intend to retire at age
60, and you want to be able to receive a 20-year, $100,000
beginning-of-the-year annuity, with the first payment to be
received on your 60th birthday. You would like to save enough money
over the next 15 years to achieve your objective; that is, you want
to accumulate the necessary funds by your 45th birthday.
A. If you expect your investments to earn 12% per year over
the next...

QUESTION 9
Suppose you plan to retire at age 70, and you want to be able to
withdraw an amount of $83,000 per year on each birthday from age 70
to age 100 (a total of 31 withdrawals). If the account which
contains your savings earns 5.4% per year simple interest, how much
money needs to be in the account by the time you reach your 70th
birthday? (Answer to the nearest dollar.)
Hint: This can be solved as a...

You want to be able to withdraw $25,000 from your account each
year for 25 years after you retire.
You expect to retire in 20 years.
If your account earns 9% interest, how much will you need to
deposit each year until retirement to achieve your retirement
goals?

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