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Essay Available:
Pages:
1 page/β‰ˆ275 words
Sources:
2 Sources
Style:
APA
Subject:
Accounting, Finance, SPSS
Type:
Essay
Language:
English (U.S.)
Document:
MS Word
Date:
Total cost:
$ 4.68
Topic:

Retirement Investing: Company Deposit, Retirement Period

Essay Instructions:

The company you work for will deposit $150 at the end of each month into your retirement fund. Interest is compounded monthly. You plan to retire 25 years from now and estimate that you will need to withdraw $2,000 per month during retirement, which will last 30 years. If the account pays 12% compounded monthly, how much do you need to put into the account each month, in addition to your company's deposit, in order to meet your retirement needs? Show all work. Explain in a written portion.

Essay Sample Content Preview:

Retirement Investing
Name
Institution
Retirement Investing
Company deposit = $150
Retirement period = 25 years from now
Withdrawal at the retirement = $ 2000 per month
Total period of retirement payments = 30 years
Interest rate = 12% per month
How much do I need to deposit each month together with the company’s deposit to meet the retirement needs?
Solution
I have to obtain the present value to determine the total amount of money that I need to have at the retirement (Garcia, 2010).
PVA = Pmt ×1-11+iNi
N = 12× 30 =360 months
i = 12%
Pmt = $ 2000
PVA = $2000× 1-11+0.12123600.1212 = $2000× (1-0.0278)0.01
PVA = $ 2000×97.22 = $...
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