Question 1153015
Uncle Moneybags has $500,000 saved for retirement.
 He has an account earning 8% interest.
 If Uncle Moneybags wants to be able to make withdrawals for 25 years, how much can he withdrawal each month? Round to the nearest cent.
:
The formula
A = {{{P(1-(1+(r/n))^(-nt))/(r/n))}}}, where
A = original amt
P = payment
r = interest rate in decimal form
n = no. of periods per year
t = no. of years
:
{{{P(1-(1+(1+(.08/12))^(-12*25))/(.08/12))}}} = 500000
:
{{{P(1-(1.0066666)^(-300))/(.08/12))}}} = 500000
:
{{{P(1-.136236516)/(.0066666)}}} = 500000
:
{{{P(.863763484)/.00666666)}}} = 500000
:
129.5645P = 500000
P = {{{500000/129.5645}}}
P = $3859.01 taken each month for 25 yrs