Assume the beginning of the eight year for payment purposes

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Reference no: EM131012050

You are trying to figure out how you can pay for your two children’s college education. The older one will start college in 8 years (assume the beginning of the eight year for payment purposes) and the younger on in 10 years. You estimate that the older child will be in college for 4 years at a cost of $65,000 per year. The younger on will go on to get a master’s degree and will be in college for 6 years at a cost of $55,000 per year. How much do you need to put aside each year for the next seven years to fund the college of both the children? Assume these payments are at the end of the year and you want to have all the money for both children in the account at the end of the seventh year. Use an 8% discount rate.

Reference no: EM131012050

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