Question

Your uncle has 431,000 invested at 6.8% and he now wants to retire. He plans to withdraw $40,000 at the end of each​ year, beginning this year.

How many years will it take to exhaust his​ funds, i.e., run the account down to​ zero?

Answer 1

CALCULATION OF YEAR TO EXHAUST THE TOTAL FUNDS
Year	Amount invested(1)	Interest @ 6.8%(2)	Withdrawals (3)	Cumulative Balance (1 +2 -3)
1	4,31,000	29,308	40,000	4,20,308
2	4,20,308	28,581	40,000	4,08,889
3	4,08,889	27,804	40,000	3,96,693
4	3,96,693	26,975	40,000	3,83,669
5	3,83,669	26,089	40,000	3,69,758
6	3,69,758	25,144	40,000	3,54,902
7	3,54,902	24,133	40,000	3,39,035
8	3,39,035	23,054	40,000	3,22,089
9	3,22,089	21,902	40,000	3,03,991
10	3,03,991	20,671	40,000	2,84,663
11	2,84,663	19,357	40,000	2,64,020
12	2,64,020	17,953	40,000	2,41,973
13	2,41,973	16,454	40,000	2,18,427
14	2,18,427	14,853	40,000	1,93,280
15	1,93,280	13,143	40,000	1,66,423
16	1,66,423	11,317	40,000	1,37,740
17	1,37,740	9,366	40,000	1,07,107
18	1,07,107	7,283	40,000	74,390
19	74,390	5,059	40,000	39,448
20	39,448	2,682	40,000	2,131
21	2,131	145	2,276	-
Answer = Total year to exhaust the total funs is 21 Years