Suppose that you save for retirement by contributing the same amount each month from your 23rd birthday until your 65th birthday, in an account that pays a steady 4% annual interest compounded monthly.
(a) How much will be in your fund at age 65 if you save $100 a month?
Your client is 40 years old and she wants to begin saving for retirement, with the first payment to come one year from now. She can save 5000 per year; and you advise her to invest it in the stock market, Which you expect to provide and average 9% in the future.
A) If she follows your advice, how much money will she have at 65?
B) How much will she have at 70?
C) She expect to live for 20 years if she retires at 65 and for 15 years if she retires at 70. If her investments continue to earn the same rate, how much will she be able to withdraw at the end of each year after retirement at each retirement age?
4 answers
kijij
yes
PMT = $5000
i = 9%
N = 25
FVA25 = $5000 [( (1+〖9%)〗^25-1 )/(9%)]
= $423 504.4811
= $423 504.50
i = 9%
N = 25
FVA25 = $5000 [( (1+〖9%)〗^25-1 )/(9%)]
= $423 504.4811
= $423 504.50
1 answer