You want to retire in 25 years. You currently have $150,000, and think you will need $1.3million at retirement. What annual interest rate must you earn to reach your goal,assuming you don't save any additional funds? 9.02%What annual interest rate must you earn if you can contribute an additional $7,500 peryear? 5.54%What annual interest rate must you earn if you can contribute an additional $15,000 peryear? 3.69%You want to retire in 35 years. You currently have $250,000, and think you will need $2million at retirement. What annual interest rate must you earn to reach your goal,assuming you don't save any additional funds? 6.12%What annual interest rate must you earn if you can contribute an additional $5,000 peryear? 4.52%What annual interest rate must you earn if you can contribute an additional $13,000 peryear? 3.02%

“Since you have asked multiple question, we will solve the first question for you. If you want any…

You want to retire in 25 years. You currently have $150,000, and think you will need $1.3 million at retirement. What annual interest rate must you earn to reach your goal, assuming you don't save any additional funds? 9.02% What annual interest rate must you earn if you can contribute an additional $7,500 per year? 5.54% What annual interest rate must you earn if you can contribute an additional $15,000 per year? 3.69%

You want to retire in 25 years. You currently have $150,000, and think you will need $1.3 million at retirement. What annual interest rate must you earn to reach your goal, assuming you don't save any additional funds? 9.02% What annual interest rate must you earn if you can contribute an additional $7,500 per year? 5.54% What annual interest rate must you earn if you can contribute an additional $15,000 per year? 3.69%

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter4: Time Value Of Money

Section: Chapter Questions

Problem 34P

See similar textbooks

Similar questions

Calculating interest earned and future value of savings account. If you put 6,000 in a savings account that pays interest at the rate of 3 percent, compounded annually, how much will you have in five years? (Hint: Use the future value formula.) How much interest will you earn during the five years? If you put 6,000 each year into a savings account that pays interest at the rate of 4 percent a year, how much would you have after five years?
You are trying to decide how much to save for retirement. Assume you plan to save $5,000 per year with the first investment made one year from now. You think you can earn 10.0% per year on your investments and you plan to retire in 43 years, immediately after making your last $5,000 investment. a. How much will you have in your retirement account on the day you retire? b. If, instead of investing $5,000 per year, you wanted to make one lump-sum investment today for your retirement that will result in the same retirement saving, how much would that lump sum need to be? c. If you hope to live for 20 years in retirement, how much can you withdraw every year in retirement (starting one year after retirement) so that you will just exhaust your savings with the 20th withdrawal (assume your savings will continue to earn 10.0% in retirement)? d. If, instead, you decide to withdraw $300,000 per year in retirement (again with the first withdrawal one year after retiring), how many years will it…
How much money would you need to have at retirement so that you can withdraw $50,000 a year for 20 years from an account earning 7% compounded annually? How much total money would you pull out of this account?
You want to be able to withdraw $30,000 from your account each year for 25 years after you retire.You expect to retire in 20 years.If your account earns 5% interest, how much will you need to deposit each year until retirement to achieve your retirement goals?
When you retire, you plan to draw $50,000 per year from your retirement accounts, which will be earning 6% per year. Find PV Annuity: If you wish to do that for 10 years starting one year after you retire, what does the balance in your retirement account have to be when you retire? Find PV Annuity: If the account will be earning 3% per year, and you wish to do that for 20 years starting on the day you retire, what does the balance in your retirement account have to be when you retire?
Please show proper steps thanks
You are trying to decide how much to save for retirement. Assume you plan to save $4,500 per year with the first investment made one year from now. You think you can earn 6.0% per year on your investments and you plan to retire in 45 years, immediately after making your last $4,500 investment. a. How much will you have in your retirement account on the day you retire? b. If, instead of investing $4,500 per year, you wanted to make one lump-sum investment today for your retirement that will result in the same retirement saving, how much would that lump sum need to be? c. If you hope to live for 16 years in retirement, how much can you withdraw every year in retirement (starting one year after retirement) so that you will just exhaust your savings with the 16th withdrawal (assume your savings will continue to earn 6.0% in retirement)? d. If, instead, you decide to withdraw $191,000 per year in retirement (again with the first withdrawal one year after retiring), how many years will it…
Assume your goal in life is to retire with one million dollars. How much would you need to save at the end of each year if interest rates average 6% and you have a 25-year work life?
You have just made your first $5,500 contribution to your retirement account. Assuming you earn a return of 10 percent per year and make no additional contributions, what will your account be worth when you retire in 45 years? What if you wait 10 years before contributing? (Does this suggest an investment strategy?) Input area: Present value Interest rate Number of years Number of years (Use cells A6 to 89 from the given information to complete this question. Your answer should be a positive value.) Output area: $5,500 10% 45 35 Future value Future value $
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 have just made your first $5,000 contribution to your retirement account. Assume youearn a return of 10 percent per year and make no additional contributions.a. What will your account be worth when you retire in 45 years?b. What if you wait 10 years before contributing?c. After calculating parts a and b, what is the lesson learned?
How much do you need to save each year for 30 years in order to have $775,000, assuming you are investing the money in an account that earns 8%? How much of the $750,000 comes from principal (you’re out of pocket costs)?