SOLUTION: Find the amount necessary to fund the given withdrawals.
Monthly withdrawals of ​$950for 5 years; interest rate is 6.6​% compounded monthly. The amount necessary to fu
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Question 1118307: Find the amount necessary to fund the given withdrawals.
Monthly withdrawals of $950for 5 years; interest rate is 6.6% compounded monthly. The amount necessary to fund the given withdrawals is?
.
Answer by addingup(3677) (Show Source): You can put this solution on YOUR website!
Present Value of an annuity = Payment[(1-(1+r)^-n)/r]
where r (periodic interest rate) = 0.066/12 = 0.0055
and n (number of periods) = 5*12 = 60
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950[(1-(1+0.0055)^-60)/0.0055]
= 950(0.28/0.0055)
= 950(50.91) = 48,364.5 this is the amount necessary to fund the withdrawals of 950 per month during 5 years
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