Question 923438
You will use the <a href="http://www.financeformulas.net/Future_Value_of_Annuity.html">future value of annuity formula</a>


<img src = "http://www.financeformulas.net/Formula%20Images/FV%20of%20Annuity%201.gif">



Rate per period: r = 0.07 (in decimal form)
n = 20 since you have 20 periods (20 years, deposit annually)
P = 5000, the amount you deposit each year



{{{FV = (P(1+r)^n - 1)/r}}}



{{{FV = (5000(1+0.07)^20 - 1)/0.07}}} Plug in the given values (see above)



{{{FV = 276391.747320441}}} Use a calculator here. You type in "(5000(1+0.07)^20 - 1)/0.07" without quotes



{{{FV = 276391.75}}} Round to the nearest penny



You will have <font color="red">$276,391.75</font> when you retire.


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Let me know if that helps or not. Thanks.


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