Question

IRAs.  Lisa and Mark married at age 20. Each year until their 30th ​birthdays, they put ​$2,600 into their traditional IRAs. By age 30​, they had bought a home and started a family. Although they continued to make contributions to their​ employer-sponsored retirement​ plans, they made no more contributions to their IRAs. If they receive an average annual return of 6​%, how much will they have in their IRAs by age 60​? What was their total​ investment?

If they receive an average annual return of 6​%, the amount they will have in their IRAs by age 60 is ​$_. ​(Round to the nearest​ dollar.)

Answer 1

They have made contribution from age 20 to age 30 i.e. nper(period)=10 year, rate =6%, periodic payment (PMT)=$2600

So,

So, at the age of 30 they will have $34270.07 amount. Their investment amount= 2600*10=$26000

If they do not invest anymore and this fund continues to grow, then the value of fund at 60 year of age i.e. 30 year after= 34270.07*(1+6%)^30=$196829.8 or $1,96,830 (Approx)

So, They will have $1,96,830 in their IRAs account at the age of 60 and their invested amount was $26,000