Solution-How much must she should deposit every year

How much must she should deposit every year

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Question - Uma turned 25 today, that she plans to retire on her 65th birthday, and that she expects to live until her 80 th birthday. On her 65 th birthday, she wants $90,000 and want that amount to increase by 2% every year until her 80 th birthday. In other words, she wants to make a withdrawal from her 65 th birthday until her 80 th (including her 80 th birthday). So far, she has managed to save $40,000 (until today) and that money is earning an interest rate of 7% compounded annually. She wants to put additional equal amount of deposit from her 26th birthday until her 64th birthday in the same account. Given this, how much must she should deposit every year to meet her retirement goal?

a. $2,381.99

b. $3,233.53

c. $2,171.88

d. $2,548.73

e. $1,823.34

Reference no: EM132830539

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How much must she should deposit every year

Reference no: EM132830539

Reference no: EM132830539

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