Derek plans to retire on his 65th birthday. However, he plans to work part-time until he turns 70.00. During these years of part-time work, he will neither make deposits to nor take withdrawals from his retirement account. Exactly one year after the day he turns 70.0 when he fully retires, he will begin to make annual withdrawals of $137,713.00 from his retirement account until he turns 90.00. After this final withdrawal, he wants $1.31 million remaining in his account. He he will make contributions to his retirement account from his 26th birthday to his 65th birthday. To reach his goal, what must the contributions be? Assume a 9.00% interest rate. (ROUND TO 4 DECIMAL PLACES.)
Derek plans to retire on his 65th birthday. However, he plans to work part-time until he turns 70.00. During these years of part-time work, he will neither make deposits to nor take withdrawals from his retirement account. Exactly one year after the day he turns 70.0 when he fully retires, he will begin to make annual withdrawals of $137,713.00 from his retirement account until he turns 90.00. After this final withdrawal, he wants $1.31 million remaining in his account. He he will make contributions to his retirement account from his 26th birthday to his 65th birthday. To reach his goal, what must the contributions be? Assume a 9.00% interest rate. (ROUND TO 4 DECIMAL PLACES.)
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
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Derek plans to retire on his 65th birthday. However, he plans to work part-time until he turns 70.00. During these years of part-time work, he will neither make deposits to nor take withdrawals from his retirement account. Exactly one year after the day he turns 70.0 when he fully retires, he will begin to make annual withdrawals of $137,713.00 from his retirement account until he turns 90.00. After this final withdrawal, he wants $1.31 million remaining in his account. He he will make contributions to his retirement account from his 26th birthday to his 65th birthday. To reach his goal, what must the contributions be? Assume a 9.00% interest rate. (ROUND TO 4 DECIMAL PLACES.)
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