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I am establishing a savings account paying 6% annual return to fund a portion of my...

I am establishing a savings account paying 6% annual return to fund a portion of my son’s college tuition. I want to make a withdrawal of an equal amount from the savings at the end of each of his first 4 years of college. I will have $24,256 in the savings account when he begins college and will keep the account open for 4 years. Identify the details below that I need in order to determine the dollar amount I can withdraw each year.

What table must I use to find the relevant factor?

  1. Future value of single-sum
  2. Present value of single-sum
  3. Future value of ordinary annuity
  4. Present value of ordinary annuity

  What is the interest rate to find the relevant factor?

  What are the number of periods (n) to find the relevant factor?

What is the dollar amount I can withdraw each year?

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