Catherine Dohanyos plans to retire in 20 years. She will make 20 years of monthly contributions to her retirement account. One month after her last contribution, she will begin the first of 10 years of withdrawals. She wants to withdraw $2800 per month. How large must her monthly contributions be in order to accomplish her goal if the account earns interest of 7.1% compounded monthly for the duration of her contributions and the 120 months of withdrawals? The amount of her monthly contributions must be $. (Round to the nearest cent as needed.)

Catherine Dohanyos plans to retire in 20 years. She will make 20 years of monthly contributions to her retirement account. One month after her last contribution, she will begin the first of 10 years of withdrawals. She wants to withdraw $2800 per month. How large must her monthly contributions be in order to accomplish her goal if the account earns interest of 7.1% compounded monthly for the duration of her contributions and the 120 months of withdrawals? The amount of her monthly contributions must be $. (Round to the nearest cent as needed.)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

Nikolay wants to make annual contributions to his RRSP for the next 30 years. He will increase each annual payment by 1.5%, and the RRSP can earn 9.3% compounded annually. If he wants to accumulate $250,000, what is the amount of his first payment at the end of the year?
Michael wants to retire in 20 years with enough savings in his RRSP to be able to purchase a 30-year annuity that will pay him $4200 at the end of every month. He has already accumulated $60,000 in his RRSP. In order to meet his goal, what RRSP contribution should Michael make at the end of each month for the next 20 years? Assume he earns 4% compounded quarterly on his RRSP, and 3.6% compounded monthly after retirement.
Additionally complete the following problems (showing all work): i. Joshua plans to retire in 25 years. He will make 15 years of equal monthly payments into his account. Ten years after his last contribution, he will begin the first of 120 (10 years) of withdrawals of $2900 per month. Assume that the retirement account earns interest of 5.4% compounded monthly for the duration of his contributions, the 10 years in between his contributions and the withdrawals, and the 10 years of withdrawals. How large must Joshua's monthly contributions be in order to accomplish his goal? (The parts below will help you work through this problem.) (a) If Joshua wants to fund 10 years of monthly withdrawals of $2900 at 5.4% interest, compounded monthly, how much needs to be in the account? (b) Use your answer from part (b) as future value to find the present value of a compound interest account for the intervening 10 years. (c) This gives you the amount in the account at the end of the 15 years of…
A woman, with her employer's matching program, contributes $300 at the end of each month to her retirement account, which earns 7% interest, compounded monthly. When she retires after 43 years, she plans to make monthly withdrawals for 25 years. If her account eams 6% interest, compounded monthly, then when she retires, what is her maximum possible monthly withdrawal (without running out of money)? The maximum possible monthly withdrawal is approximately $ (Simplify your answer. Round to the nearest cent as needed) CD-
Mia plans to save for retirement starting at the age of 35 (year O). She will make a payment at the beginning of each year until age 64. Starting from age 65, she will withdraw 100,000 USD every year for 20 years until her age of 84. Her account balance will reach to $0 at the beginning of her age 85. The retirement plan Mia is looking at provides a interest rate of 10% annually. What would be the fair annual payment for 30 years of this retirement plan? $5175.61 $4275.33 $5293 $53669
Sehar has accumulated $245,000 in her retirement savings plan. When she retires in exactly 4 years from today, she will purchase an annuity that will provide end-of-month payments for 20 years. If her funds earn 6% compounded quarterly during both the period of deferral and the annuity period, how much will her Sehar’s monthly payments be during retirement?
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 $12,000/month for 20 years from her retirement account starting at that time. How much must she contribute each month for 30 years into a retirement account earning interest at the rate of 2%/year compounded monthly to meet her retirement goal? (Round your answer to the nearest cent.)
Irene plans to retire on December 31st, 2019. She has been preparing to retire by making annual deposits, starting on December 31st, 1979, of $2450 into an account that pays an effective rate of interest of 9.1%. She has continued this practice every year through December 31st, 2000. Her goal is to have $1.5 million saved up at the time of her retirement. How large should her annual deposits be (from December 31st, 2001 until December 31st, 2019) so that she can reach her goal? Payment = $68573.5
A woman is planning for retirement in 30 years and decides she can deposit $6,000 each year on December 31 into a retirement savings plan that she expects will pay 6% interest. In 20 years she also expects to receive a small inheritance of $12,000 that she can also put into her retirement fund. The woman anticipates that her retirement fund will need to last 20 years; she estimates that she will need $60,000 at the end of each year in retirement to cover her living expenses. Her plan is flawed. How much extra does she need to save every year (rounded to dollars and cents) to achieve her goals? (Do not round interim calculations)
Ashley invests $250 a month in her 401(k) retirement account, which earns an 8 percent annual return. After 35 years, how much money will she have in the account over and above the amounts she will contribute through the years?
Annie would like a retirement income of $4,000 per month (beginning of month payments) for 23 years once she retires. How much must she have in her retirement account on the day she retires if the account can earn 4% compounded semi-annually? Your Answer: Answer
Catherine Dohanyos plans to retire in 20 years. She will make 20 years of monthly contributions to her retirement account. One month after her last contribution, she will begin the first of 10 years of withdrawals. She wants to withdraw $2400 per month. How large must her monthly contributions be in order to accomplish her goal if the account earns interest of 7.3% compounded monthly for the duration of her contributions and the 120 months of withdrawals? Question content area bottom Part 1 The amount of her monthly contributions must be Senter your response here. (Round to the nearest cent as needed.)

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS