Question

You want to have $75,000 in your savings account 12 years from
now, and you’re prepared to make equal annual deposits into the
account at the end of each year. If the account pays 6.8 percent
interest, what amount must you deposit each year? **How to
input the formula in Excel?**

Answer #1

Desired sum after 12 years = $75,000

Annual Interest rate = 6.8%

Annual Deposit * FVIFA(6.8%, 12) = $75,000

Annual Deposit * (1.068^12 - 1) / 0.068 = $75,000

Annual Deposit * 17.67928 = $75,000

Annual Deposit = $4,242.25

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