You are saving up to retire early. You plan to deposit $195 every week for 20...

You are saving up to retire early. You plan to deposit $195 every week for 20 years. If you think you can earn 8% per year on average, how much will you have in 20 years?

Expert Solution

Future Value of an Ordinary Annuity
= C*[(1+i)^n-1]/i

Where,
C= Cash Flow per period =$195
i = interest rate per period =8%/52 =153846154%
n=number of period =52*20 =1040

= $195[ (1+0.00153846154)^1040 -1] /0.00153846154

= $195[ (1.00153846154)^1040 -1] /0.00153846154

= $195[ (4.9469 -1] /0.00153846154]

= $5,00,275.45

jeff jeffy answered 2 years ago

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