Question

An engineer is on the verge of retirement. She saved $ 100,000 which is deposited in...

An engineer is on the verge of retirement. She saved $ 100,000 which is
deposited in an account that pays 6% interest per year capitalized
quarterly. His plan is to withdraw $ 6,000 per quarter to satisfy his
needs. In how many years will she use up her savings?

Homework Answers

Answer #1

We are given the following information:

Quarterly payment PMT $            6,000.00
rate of interest r 6.00%
number of years n To be calculated
Quarterly Compounding frequency 4
Present value PV $ 100,000.00

We need to solve the following equation to arrive at the required n


So the number of years are 4.83 years of 19.32 quarters

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
An Engineer deposited $12,000 in a bank saving account that pays 3% per quarter. a) How...
An Engineer deposited $12,000 in a bank saving account that pays 3% per quarter. a) How much money the engineer will find in his account after 4 years? b) What will be the effective interest rate per six months? c) What will be the effective interest rate per year?
An engineer on the is planning to retire in 10 years. She has accumulated savings of...
An engineer on the is planning to retire in 10 years. She has accumulated savings of $450,000 that are in an account paying 7% interest compounded quarterly. If she makes no more deposits, how much would her retirement savings be when she retires? (a) $765,223 (b) $885,215 (c) $900,719 (d) $999,756
Upon retirement, Juanita moves her whole retirement account into a new account earning 4.7% annually. If...
Upon retirement, Juanita moves her whole retirement account into a new account earning 4.7% annually. If Juanita wishes to withdraw from her account quarterly and she plans on her retirement account lasting for 20 years, what amount can she withdraw each quarter?
A man has deposited $50,000 in a retirement income plan with a local bank. This bank...
A man has deposited $50,000 in a retirement income plan with a local bank. This bank pays 8% per year, compounded annually, on such deposits. What is the maximum amount the man can withdraw at the end of each year and still have the funds last for 12 years? Suppose that a person deposits $500 in a savings account at the end of each years, starting now for the next 12 years. If the bank pays 8% per year, compounded...
You have a retirement account in which you have saved up $1,000,000. You are thinking of...
You have a retirement account in which you have saved up $1,000,000. You are thinking of retiring and you will have to withdraw $80,000 per year to pay your living and travel expenses in retirement. How many years will it take to deplete the account (quote number of years to the nearest tenth), if the account earns 3% per year and the first withdrawal is in one year?
Assume that you saved $641,000 in a retirement account. The money is deposited in an account...
Assume that you saved $641,000 in a retirement account. The money is deposited in an account that earns 5% interest compounded Weekly. You want to retire and begin making weekly withdrawals from the account such that the money (principal and interest) lasts exactly 23 years. What is the amount of the weekly withdrawal?
Doreen is celebrating her 35th birthday and decides she needs to start saving for retirement beginning...
Doreen is celebrating her 35th birthday and decides she needs to start saving for retirement beginning at age 65. She wants to be able to withdraw 90,000 annually for 15 years starting on her 66th birthday. She intends to invest at 8% over the life of the account. Her employer will contribute 1500 per year until she retires. Additionally, she expects a 25,000 distribution from a family trust on her 55th birthday which will be deposited into the retirement account....
a. Suppose your client is 35 years old and has already saved $150,000 for retirement. How...
a. Suppose your client is 35 years old and has already saved $150,000 for retirement. How much does your client need to contribute to a fund each month for the next 25 years (first payment at the end of this month), to reach a retirement goal of 4,000,000, if the fund is expected to earn an effective annual rate of 12%? b. Suppose your client is also very generous, and wishes to leave the entire $4,000,000 in savings to charity...
You want to retire in 38 years and have $100,000 currently saved in an account earning...
You want to retire in 38 years and have $100,000 currently saved in an account earning 9.5% interest. How much must you deposit into that account each month to be able to retire for 25 years and withdraw $500,000 per year if you are able to earn 5% during retirement?
6. Tom and Mary have saved $100,000 to finance their daughter Jenny’s college education. They deposited...
6. Tom and Mary have saved $100,000 to finance their daughter Jenny’s college education. They deposited the money in the Arrowhead Savings and Loan Association, where it earns 5% interest compounded semiannually. What equal amounts can their daughter withdraw at the end of every 6 months during her 4 college years, without exhausting the fund? Instructions: use the Compound interest tables to solve -Future value of 1 (future value of a single sum) -Present value of 1 (present value of...