User Account

All Pages

How much will his investments be worth

Assignment Help Finance Basics
Reference no: EM132554992

Your dad is now 55 years old and plans to retire at age 70. He currently has a stock portfolio worth $450,000. The portfolio is expected to earn a return of 8 percent per year.

a. If your dad does not save another penny, what will be the total value of his investments when he retires at age 70?

b. Assume he plans to invest an additional $12,000 every year in his portfolio for the next 15 years (starting one year from now). How much will his investments be worth when he retires at 70?

c. Assume that your dad expects to live 20 years after he retires (i.e., until age 90). Today, at age 55, he takes all of his investments and places them in an account that pays 5 percent per year (use the scenario from part b in which he continues saving and assume that the additional savings also earn a return of 5 percent per year). If he starts withdrawing funds starting on the day he turns 71, how much can he withdraw every year and leave nothing in the account after a 20th and final withdrawal on the day he turns 90?

Reference no: EM132554992

Questions Cloud

Compute the most optimistic estimate of npv : Suppose the annual savings are $18,000. Compute the NPV. Compute the most optimistic estimate of NPV, combining the best outcomes
Differences between design capacity and effective capacity : Analyze two or three (2-3) differences between design capacity and effective capacity, and then predict one or two (1-2) challenges
How to find the project irr : NPV and IRR Lalala Company is considering, Compute the project's IRR. Suppose the company uses the NPV model. Would it accept the project? Why or why not?
Would you use predictive or descriptive data mining : Would you use predictive or descriptive data mining at this point? What data would you use to research this? What time length of data would you use for this.
How much will his investments be worth : Your dad is now 55 years old and plans to retire at age 70. He currently has a stock portfolio worth $450,000. The portfolio
Communication strategy : Besides the information provided, determine additional information that you will need to plan your communication strategy.
Find should the grill be purchased : Find Should the grill be purchased? Assuming the discount rate is 11%, calculate the net present value (NPV) of the cash flow stream.
Differences in power distance-uncertainty avoidance : Discuss the differences in power distance, uncertainty avoidance, individualism versus collectivism, and masculine versus feminine of the different cultures.
Explain disadvantages of preparing funds flow statements : State thoroughly the Difference between a statement of cash flows and a statement of sources and supplication of funds (funds flow statement).

Reviews

Write a Review

Finance Basics Questions & Answers

  Financial reporting and analysis

Finance is about Gunns Ltd, a company in dealing with forestry products in Australia. The company has also been listed in Australian Stock Exchange. As many companies producing forestry products, even Gunns Ltd is facing various problems. Due to the ..

  A report on financial accounting

This report is specific for a core understanding for Financial Accounting and its relevant factors.

  Describe the types of financial ratios

Describe the types of financial ratios and other financial performance measures that are used during venture's successful life cycle.

  Differences between sole proprietorship and corporation

Briefly describe the major differences between a sole proprietorship and a corporation

  Prepare a cash budget statement

Calculate the expected value of the apartment in 20 years' time. What is the mortgage loan repayment at the beginning of each month

  What are the implied interest rates

What are the implied interest rates in Europe and the U.S.?

  State pricing theory and no-arbitrage pricing theory

State pricing theory and no-arbitrage pricing theory

  Small business administration

Identify the likely stage for each venture and describe the type of financing each venture is likely to be seeking and identify potential sources for that financing.

  Effect of financial leverage

The Effect of Financial Leverage and working capital management

  Evaluate the basis for the payment to the lender

Evaluate the basis for the payment to the lender and basis for the payment to the company-counterparty.

  Importance of opps, ipps, mpfs and dmepos

Research and discuss the differences and importance of : OPPS, IPPS, MPFS and DMEPOS.

  Time value of money

Time Value of Money project

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd