Question

To calculate the future value of an annuity (savings plan), we use the formula: FV = PMT[(1 + rin) nt) - 1]/(r/n) where PMT is the payment amount that is deposited on a regular basis, r is the APR, n is the number of regular payments made each year and FV is the future value after t years. At the age of 25, Kyle starts an IRA (Individual Retirement Account) to save for retirement. He deposits $200 into the account each month. Based on past performance of similar accounts, he expects to obtain an annual interest rate of 8% How much money will Kyle have saved upon retirement at age 65?

Answer 1

And to find How much money kyle ha upon retirement at age 65 noney kyle have saved By using formula FV = PMT{{1+ (8m)) (n + ] (oln) given PMT= deposits into account each month = $200 VaRa annual interest rate = 8% = 0.08 na no of regular payment each years = 12 t= future value after 't years = 65-25 = 40 6.08 F.V= 200 (1+1))?(40), 7 (0000 (FW = $698, 202.722 money kyle has saved on retirement = $698,202.722