Question
In: Finance
if you have desire to have a 500,000 nest egg one day, how much will you...
if
you have desire to have a 500,000 nest egg one day, how much will
you need to contribute to an retirement account on a monthly basis
assuming you have 30 years to save and expect an average rate or
return of 5.5%?
Solutions
Expert Solution
We can use financial calculator for calculation of monthly contribution with below keystrokes.
contribution is monthly. so, contribution period and rate of return will also be monthly.
N = contribution period in months = 30*12 = 360; I/Y = monthly rate of return = 5.5%/12 = 0.4583%; FV = future value = 500,000; PV = present value = $0 > CPT = compute > PMT = monthly contribution = $547.32
you will need to contribute $547.32 on a monthly basis.
jeff jeffy answered 2 years agoRelated Solutions
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