What equal annual deposits must you make each year

Reference no: EM132038805

Question: You plan to retire 38 years from now. You expect that you will live 25 years after retiring. You want to have enough money upon reaching retirement age to withdraw $100,000 from the account at the end of each year you expect to live, and yet still have $125,000 left in the account at the time of your expected death (63 years from now). You plan to accumulate the retirement fund by making equal annual deposits at the end of each year for the next 38 years. You expect that you will be able to earn 11% per year on your deposits. However, you only expect to earn 5% per year on your investment after you retire since you will choose to place the money in less risky investments. What equal annual deposits must you make each year to reach your retirement goal?

Reference no: EM132038805

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