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You are going to save money for your son’s education. You have decided to place $786...

You are going to save money for your son’s education. You have decided to place $786 every half year at the end of the period into a saving account earning 5.15 percent per year, compounded semi-annually for the next 13 years. How much money will be in the account at the end of that time period?

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Answer #1

We can use the future value of annuity formula to find the answer:

Where,
FVA = Future Value of Annuity
A = Annuity or payment
i = rate of interest
n = number of years
a = number of payments in a year

Substituting the values, we get:

Therefore, at the end of time period there will $41,057.07 in the account.

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