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You would like to accumulate $850,000 for your retirement life. If you still have 30 years...

You would like to accumulate $850,000 for your retirement life. If you still have 30 years until retirement, have no retirement savings now, and believe you can earn 7% per year on your investments, how much should you invest monthly to reach your retirement goal? please show work of how to obtain this answer

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Answer #1

Information provided:

Future value= $850,000

Interest rate= 7%/12= 0.5833%

Time= 30 years*12= 360 months

The below has to be entered in a financial calculator to compute the amount to be saved each month:

FV= 850,000

I/Y= 0.5833

N= 360

Press the CPT key and PMT to compute the amount to be saved each month.

The value obtained is 696.79.

Therefore, $696.79 has to be saved each month to accumulate $850,000.

In case of any query, kindly comment on the solution.

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