How much money do you need to save each year to be a millionaire by the...

How much money do you need to save each year to be a millionaire by the time you are 65 if you can earn an interest rate of 8% and you start saving when you were born? Please use two decimals rounded up.

Expert Solution

PV = Amount required = $1,000,0000

n = 65 years

r = interest rate = 8%

P = Annual savings

Annual savings can be calculated using the below formula

P = [r*PV] / [1 - (1+r)^-n]

= [8%*$1,000,000] / [1 - (1+8%)^-65]

= $80,000 / 0.99327865955

= $80,541.3458055

Therefore, amount required to save each year is $80,541.35

jeff jeffy answered 2 years ago

1. How much money do you need to save each year to be a millionaire by...

1. How much money do you need to save each year to be a millionaire by the time you are 65 if you can earn an interest rate of 8% and you start saving when you are 20 years old? Please use two decimals rounded up/down. 2. How much money do you need to save each year to be a millionaire by the time you are 65 if you can earn an interest rate of 8% and you start saving...

You want to retire has a millionaire. How much do you need to put away each month if

You want to retire has a millionaire. How much do you need to put away each month if:You use common stocks and have an average return of 10%?You use corporate bonds and have an average return of 6%?You use government bonds and have an average return of 4%?You put your money in a CD at 2.5% interest rate?(use your own age. If you are over 45, solve for saving a $100,000.)

How much do you need to save to achieve each of the goals you set out...

How much do you need to save to achieve each of the goals you set out and how do you plan on reaching that goal? (i.e Assuming a 2% return on my money, to achieve goal 1 I will need to save $50 bi-weekly for 5 years) **Use reasonable rates of return based on your time horizon and identify how you determined the rate of return to use** SHOW WORK Rate of return: I believe my savings account generate 2.3%...

If the time value of the money is .10 how much do you have to save...

If the time value of the money is .10 how much do you have to save per year for 20 years to have $50,000 per year for perpetuity? Assume that the first deposit is immediate and that the first payment will be at the beginning of the 21st year. Suppose that you decide to hold the bonds in the previous question for a year, and then sell them. The next year, the interest rate on comparable bonds increases to 9.5%....

2. Wes wants to retire as a millionaire. How much must Wes save per year for...

2. Wes wants to retire as a millionaire. How much must Wes save per year for 40 years, if he can invest in a mutual fund which pays 4% compounded semi-annually? 3. You just purchased a new car for $45,000. Your down payment on the vehicle was $15,000 and the rest is financed over 5 years at a 6% annual interest rate. Calculate your monthly payment. how would I solve these two? Please and thank you very much.

3. You want to save enough money to retire as a millionaire. (Age now is 30)...

3. You want to save enough money to retire as a millionaire. (Age now is 30) a. If you could earn 10% with common stocks, how much would you have to set aside per year to have $1,000,000 when you are 65? b. If you were going to make deposit monthly, how much would you have to set aside per month to have $1,000,000 when you are 65? c. What type of a problem is this?

You want to be a millionaire when you retire in 35 years. How much do you...

You want to be a millionaire when you retire in 35 years. How much do you have to save each month if you can earn an annual return of 11.5 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Savings per month $ How much do you have to save each month if you wait 15 years before you begin your deposits? (Do not round intermediate calculations and round your answer to 2...

2. You need to have $150,000 for your children’s tuition. How much money do you need...

2. You need to have $150,000 for your children’s tuition. How much money do you need to set aside each month for this amount to be available in 15 years? a. If you were to invest the money in a savings account at 3% interest? b. If you were to invest the money in a bond fund at 6% interest? c. If you were to invest the money in an equity fund at 10% interest? d. What type of a...

11.You want to be a millionaire when you retire in 40 years. a. How much do...

11.You want to be a millionaire when you retire in 40 years. a. How much do you have to save each month if you can earn an annual return of 9.7 percent? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. How much do you have to save each month if you wait 10 years before you begin your deposits? (Do not round intermediate calculations and round your answer to 2 decimal places,...

How much money should you save now to have a guaranteed saving of $1,000 per year...

How much money should you save now to have a guaranteed saving of $1,000 per year for 12 years starting next year, at a rate of return of 12% per year? $12,600 $6,200 $12,000 $6,000

Question