document.write( "Question 1148193: Julie won $200 000 in a lottery! She estimates that to live comfortably she will need to withdraw $5000 per month for the next 50 years. Her savings Account earns 4.25%, compounded monthly. Can Julie afford to retire and live off her lottery winnings? \n" ); document.write( "

Algebra.Com's Answer #769607 by MathTherapy(10552) $\"\"$ $\"About$

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Julie won $200 000 in a lottery! She estimates that to live comfortably she will need to withdraw $5000 per month for the next 50 years. Her savings Account earns 4.25%, compounded monthly. Can Julie afford to retire and live off her lottery winnings?
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You don't need to calculate how much she needs for 50 years or 600 (50 * 12) months.
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document.write( "Common sense should DICTATE that about 40 payments of $5,000 each, will DEPLETE these funds entirely, because 40($5,000) = $200,000. 
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document.write( "So, right away, you see that it's impossible for this amount to last anywhere close to 600 months or for her to get 600 payments 
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document.write( "when it's ALMOST finished after she receives 40 payments (40 months) of $5,000 each.
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document.write( "Another way to look at this: Withdrawing $5,000 per month, for just 1 year (12 months) will deplete the funds by at least $60,000 (5,000 * 12).
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document.write( "How much longer than a year do you think this amount would last?   
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document.write( "NOT REQUIRED, but what the HECK!!
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document.write( "As a matter of fact, for her to be able to withdraw $5,000 per month for 50 years (600 months), she'll need to have $1,242,519.27, at the beginning of her retirement, or year 0. \n" );
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