Corporate Finance Assignment/ Professional Essay Writers
Time Value of Money for present and future values
You just turned 25 you plan on saving an equal amount in your 401K at the of each year for 40 years (your 65th birthday) You expect to earn 9% pa during this time frame at 65 you will begin drawing down on this account $75,000 annually You expect to live to be 90 years old (25 years) You earn 5% on the account during your retirement years Note: you expect your timing to be “perfect” (the money runs out on your 90th birthday)
a. How much do you need to save annually between 25& 65?
b. How much will you need on hand at 65 to cover the $75,000 annuity payment for 25 years?
c. How much (PV) you need at 65 to pay 75k for 25 years? Figure what you have to save for 40 years to get to that balance (FV). Get Finance Help Today