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In 10 years you are planning on retiring and buying a house in Florida. The house you are looking at currently costs $100,000 and is expected to increase in value each year at a rate of 5 percent. Assuming you can earn 10 percent annually on your investments, how much must you invest at the end of each of the next 10 years to be able to buy your dream home when you retire?
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- Suppose you want to save up $100,000 to buy a house in 10 years. You plan to invest a lump sum amount of $50,000 today in a savings account that pays an annual interest rate of 6%. How long will your investment take to grow to $100,000? Will you be able to buy your desired house with the current investment after 10 years?After graduation from university, you start working and you want to plan for your retirement. You will be retiring in 25 years and during your retirement, you plan to spend USD 20,000 per year. You expect your retirement to last 30 years. You believe you can earn 8% on your retirement savings. If you make annual payments into a retirement plan during your working life, how much will you need to save each year to reach your retirement goal? (You will make the first payment at the end of the year).Suppose you have three goals in your financial planning for saving money.First, you would like to be able to retire 25 years from now with a retirement income of $10,000 (today's dollar) per month for 20 years. Second, you would like to purchase a vacation home in Sedona in 10 years at an estimated cost of $500,000 (today's dollars). Third, assuming that you will live until your life expectancy, say 20 years after your retirement, you would like to leave a cash contribution to your college in the amount of $1,000,000 (actual dollars). You can afford to save $2,000 (actual dollars) per month for the next 10 years. Assume that the general inflation rate is 4% and the property value in Sedona increases at an annual rate of 5%. Your first retirement withdrawal will be made 25 years and 1 month from now. Before retirement, you would be able to invest your money at an annual rate of 10%. But after retirement, you will invest your assets in more conservative financial assets at an annual rate…
- In planning for your retirement, you have decided that you would like to be able to withdraw $60,000 per year for a 10 year period. The first withdrawal will occur 20 years from today. a. What amount must you invest today if your return is 10% per year? b. What amount must you invest today if your return is 15% per year?You want to be a millionaire when you retire in 40 years. How much do you have to save each month if you can earn an annual return of 10.8 percent? How much do you have to save each month if you wait 10 years before you begin your deposits? How much do you have to save each month if you wait 20 years before you begin your deposits?Suppose you have three goals in your financial planning for saving money. First, you would like lo be able to retire 25 years from now with a retirement income of $10,000 (today's dollar) per month for 20 years. Second, you would like to purchase a vacation home in Sedona in 10 years at an estimated cost of $500,000 (today's dollars). Third, assuming that you will live until your life expectancy, say 20 years after your retirement, you would like to leave a cash contribution to your college in the amount of $1,000,000 (actual dollars). You can afford to save $2,000 (actual dollars) per month for the next 10 years. Assume that the general inflation rate is 4% and the property value in Sedona increases at an annual rate of 5%. Your first retirement withdrawal will be made 25 years and 1 month from now. Before retirement, you would be able to invest your money at an annual rate of 10%. But after retirement, you will invest your assets in more conservative financial assets at an annual…
- In 10 years, you plan to retire and buy a lotin the province. The lot you are looking at currently costs P100,000 and is expected to increase in value each year at a rate of 5 percent. Assuming you can earn 10 percent annually on your investments, how much must you invest at the end of each of the next 10 years to be able to buy the lot when you retire?(Future value of an annuity) In 7 years you are planning on retiring and buying a house in Oviedo, Florida. The house you are looking at currently costs $100,000 and is expected to increase in value each year at a rate of 4 percent. Assuming you can earn 12 percent annually on your investments, how much must you invest at the end of each of the next 7 years to be able to buy your dream home when you retire? a. If the house you are looking at currently costs $100,000 and is expected to increase in value each year at a rate of 4 percent, what will the value of the house be when you retire in 7 years? $nothing (Round to the nearest cent.)You believe you will need to have saved $480,000 by the time you retire in 30 years in order to live comfortably. You also believe that you will inherit $115,000 in 5 years. a) If the interest rate is 6% per year, what is the future value of your inheritance at retirement? b) How much additional money must you save to meet your retirement goal, assuming you save your entire inheritance?
- You believe you will need to have saved $510,000 by the time you retire in 30 years in order to live comfortably. If the interest rate is 7% per year, how much must you save each year to meet your retirement goal?You believe you will need to have saved $593,000 by the time you retire in 30 years in order to live comfortably. You also believe that you will inherit $113,000 in 5 years. 1) If the interest rate is 7% per year, what is the future value of your inheritance at retirement? 2) How much additional money must you save to meet your retirement goal, assuming you save your entire inheritance?Jim Smith believes that in 30 years he will need $80,000 to buy a retirement cottage. Assuming he gets an interest rate of 9% compounded annually, how much will he have to invest today, to reach his retirement goal?