SOLUTION: Jennifer is the owner of a video game and entertainment software retail store. She is currently planning to retire in 30 years and wishes to withdraw $10,000/month for 20 years fro
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Question 1133531: Jennifer is the owner of a video game and entertainment software retail store. She is currently planning to retire in 30 years and wishes to withdraw $10,000/month for 20 years from her retirement account starting at that time. How much must she contribute each month for 30 years earning interest at a rate of 5% compounded monthly to meet her goal? Answer by Boreal(15235) (Show Source):
You can put this solution on YOUR website! Amount to contribute is A=m(1+(r/n))^360-1/(r/n)
Amount to withdraw requires m(1-(1+(r/n)^-(nt)/(r/n)
m is the amount withdrawn each month, so 10000(1-(1+.05/12)^(-240))/(.05/12)
=$1515253.13, rounding at the end.
This is equal to m[(1+(r/n)^360)-1]/(r/n)
$1820.65 ANSWER
