SOLUTION: You have $500,000 saved for retirement. Your account earns 7% interest. How much will you be able to pull out each month, if you want to be able to take withdrawals for 25 years?

Question 1195622: You have $500,000 saved for retirement. Your account earns 7% interest. How much will you be able to pull out each month, if you want to be able to take withdrawals for 25 years?
Answer by Boreal(15235) (Show Source): You can put this solution on YOUR website!
PV = P × {1 − (1+r)−nr/r}
500000=P(1-(1+(.07/12))^-300/).07/12. Multiply through by 0.07/12
2916.6667=P*(0.8253)
P=$3533.90 the answer
round at the end, not in the middle
on calculator do 0.07/12
then add to 1
then raise to -300 power (25 years and 12 months/yr)
subtract that value from 1
then move it to the other side by dividing both sides.
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