You believe you will need to have saved $480,000 by the time you retire in 40 years in order to live comfortably. if the interest rate is 6% per year, how much must you save each year to meet your retirement goal
Hi there Use the formula of the future value of annuity ordinary The formula is Fv=pmt [(1+r)^(n)-1)÷r] Fv future value 480000 PMT payment per year? R interest rate 0.06 N time 40 years First we need to solve for pmt PMT=Fv÷[(1+r)^(n)-1)÷r] PMT=480,000÷(((1+0.06)^(40)−1) ÷(0.06))=3,101.54....answer
