Question

Deon makes monthly contributions of $250.00 at the end of every month into an RRSP. Calculate,...

  1. Deon makes monthly contributions of $250.00 at the end of every month into an RRSP. Calculate, to the nearest month, how long it will take to grow to $100 000.00 if interest is 8% compounded annually.

ANSWER: __________________________

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Answer #1

We will use the financial calculator to find the number of months. Please follow the below mentioned steps on your BA 2 PLUS-

2ND FV (to clear previous data)

8/12 I/Y (8% for each month so divided by 12)

-250 PMT (monthly payment)

0 PV (no present value)

100,000 FV (final figure required)

CPT N (computre number of months)

Answer- 195.5414 months

196 months approximately

It will take Deon 196 months approximately to grow $100,000.

Do let me know in the comment section in case of any doubt.

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