SOLUTION: You withdraw $1500 from a bank account each month that earns 3% annual interest. How much money do you need to start with in the account so that it will last 20 years? Round your a

Question 1194625: You withdraw $1500 from a bank account each month that earns 3% annual interest. How much money do you need to start with in the account so that it will last 20 years? Round your answer to 2 decimal places

Answer by Theo(13342) (Show Source): You can put this solution on YOUR website!
you would need 270,466.37 rounded to the nearest penny.
the amount rounded to the display size of the ti-ba-ii calculator that i used is 270,466.3716.
the actual amount, rounded to more decimal places, is 270,466.371618706, which i got from an excel spreadsheet.
your solution is 270,466.37.
i also used an online calculator to get this value.
the result from using that calculator, at https://arachnoid.com/finance/ is shown below:

inputs are everything except pv (present value).
output is pv.
number of years is multiplied by 12 to get 20 * 12 = 240 months.
interest rate per year is divided by 12 to get .25% per month.
payments are assumed to be at the end of each month.

RELATED QUESTIONS
You are about to set up a new retirement savings account that earns interest at a 3.5%... (answered by ikleyn)

You have a saving $350,000 in a retirement account that earns 4.8% annual interest. You... (answered by Theo)

You want to be able to withdraw $40,000 each year for 25 years. Your account earns 7%... (answered by Theo)

You want to be able to withdraw $40,000 each year for 30 years. Your account earns 9%... (answered by Boreal)

You want to be able to withdraw $20,000 each year for 25 years. Your account earns 10%... (answered by ariana3212)

You want to be able to withdraw $20,000 each year for 25 years. Your account earns 10%... (answered by Theo)

You want to be able to withdraw $45,000 each year for 20 years. Your account earns 6%... (answered by ikleyn)

You want to be able to withdraw $35,000 each year for 20 years. Your account earns 5%... (answered by ikleyn)

You want to be able to withdraw $30,000 each year for 30 years. Your account earns 4%... (answered by Boreal)