Question 1071064: Help Please!
Meg's pension plan is an annuity with a guaranteed return of 5% per year (compounded quarterly). She would like to retire with a pension of $10,000 per quarter for 25 years. If she works 37 years before retiring, how much money must she and her employer deposit each quarter? (Round your answer to the nearest cent.)
Answer by ankor@dixie-net.com(22740)   (Show Source):
You can put this solution on YOUR website! Meg's pension plan is an annuity with a guaranteed return of 5% per year (compounded quarterly).
She would like to retire with a pension of $10,000 per quarter for 25 years.
If she works 37 years before retiring, how much money must she and her employer deposit each quarter? (Round your answer to the nearest cent.)
:
I used the financial feature on my calculator
Find how much she will need when she retires
Entered 100 periods (4*25 yrs), 5% and $10000 every quarter
FV = $1,970,723.42
:
Find how much has to be deposited quarterly over 37 yrs to acquire the above amt
entered n = (37*4) = 148; i=5%; FV = 1970723 resulting in
Pmt: $4659 per quarter required
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