Question
In: Statistics and Probability
Your employer is going to invest $75 per month in a 401k for you and promised...
Your employer is going to invest $75 per month in a 401k for you and promised to average a 5% return over the next 20 years. What would I type into Excel to estimate how much money should be in the 401k after 20 years?
Solutions
Expert Solution
We first compute the equivalent number of months for 20 years here as: 20*12 = 240 months.
Therefore we need to compute the Future value of 240 installments here as:
After this we simply extend the formula for all the rows here and get the FV of each of the installment to get here:
| Month | Installment | Future Value |
| 1 | 75 | 198.997328 |
| 2 | 75 | 198.189878 |
| 3 | 75 | 197.385704 |
| 4 | 75 | 196.584793 |
| 5 | 75 | 195.787132 |
| 6 | 75 | 194.992708 |
| 7 | 75 | 194.201507 |
| 8 | 75 | 193.413516 |
| 9 | 75 | 192.628723 |
| 10 | 75 | 191.847114 |
| 11 | 75 | 191.068677 |
| 12 | 75 | 190.293398 |
| 13 | 75 | 189.521265 |
| 14 | 75 | 188.752265 |
| 15 | 75 | 187.986385 |
| 16 | 75 | 187.223613 |
| 17 | 75 | 186.463935 |
| 18 | 75 | 185.707341 |
| 19 | 75 | 184.953816 |
| 20 | 75 | 184.203349 |
| 21 | 75 | 183.455927 |
| 22 | 75 | 182.711537 |
| 23 | 75 | 181.970168 |
| 24 | 75 | 181.231807 |
| 25 | 75 | 180.496443 |
| 26 | 75 | 179.764061 |
| 27 | 75 | 179.034652 |
| 28 | 75 | 178.308202 |
| 29 | 75 | 177.5847 |
| 30 | 75 | 176.864134 |
| 31 | 75 | 176.146491 |
| 32 | 75 | 175.431761 |
| 33 | 75 | 174.71993 |
| 34 | 75 | 174.010988 |
| 35 | 75 | 173.304922 |
| 36 | 75 | 172.601721 |
| 37 | 75 | 171.901374 |
| 38 | 75 | 171.203868 |
| 39 | 75 | 170.509193 |
| 40 | 75 | 169.817336 |
| 41 | 75 | 169.128286 |
| 42 | 75 | 168.442032 |
| 43 | 75 | 167.758563 |
| 44 | 75 | 167.077867 |
| 45 | 75 | 166.399933 |
| 46 | 75 | 165.72475 |
| 47 | 75 | 165.052307 |
| 48 | 75 | 164.382592 |
| 49 | 75 | 163.715594 |
| 50 | 75 | 163.051303 |
| 51 | 75 | 162.389707 |
| 52 | 75 | 161.730796 |
| 53 | 75 | 161.074558 |
| 54 | 75 | 160.420983 |
| 55 | 75 | 159.77006 |
| 56 | 75 | 159.121778 |
| 57 | 75 | 158.476127 |
| 58 | 75 | 157.833096 |
| 59 | 75 | 157.192673 |
| 60 | 75 | 156.554849 |
| 61 | 75 | 155.919613 |
| 62 | 75 | 155.286955 |
| 63 | 75 | 154.656864 |
| 64 | 75 | 154.029329 |
| 65 | 75 | 153.404341 |
| 66 | 75 | 152.781889 |
| 67 | 75 | 152.161962 |
| 68 | 75 | 151.544551 |
| 69 | 75 | 150.929645 |
| 70 | 75 | 150.317234 |
| 71 | 75 | 149.707308 |
| 72 | 75 | 149.099856 |
| 73 | 75 | 148.49487 |
| 74 | 75 | 147.892338 |
| 75 | 75 | 147.292251 |
| 76 | 75 | 146.694599 |
| 77 | 75 | 146.099373 |
| 78 | 75 | 145.506561 |
| 79 | 75 | 144.916154 |
| 80 | 75 | 144.328144 |
| 81 | 75 | 143.742519 |
| 82 | 75 | 143.15927 |
| 83 | 75 | 142.578388 |
| 84 | 75 | 141.999863 |
| 85 | 75 | 141.423686 |
| 86 | 75 | 140.849846 |
| 87 | 75 | 140.278335 |
| 88 | 75 | 139.709142 |
| 89 | 75 | 139.14226 |
| 90 | 75 | 138.577677 |
| 91 | 75 | 138.015385 |
| 92 | 75 | 137.455375 |
| 93 | 75 | 136.897637 |
| 94 | 75 | 136.342162 |
| 95 | 75 | 135.788941 |
| 96 | 75 | 135.237965 |
| 97 | 75 | 134.689224 |
| 98 | 75 | 134.14271 |
| 99 | 75 | 133.598414 |
| 100 | 75 | 133.056326 |
| 101 | 75 | 132.516438 |
| 102 | 75 | 131.97874 |
| 103 | 75 | 131.443224 |
| 104 | 75 | 130.909881 |
| 105 | 75 | 130.378702 |
| 106 | 75 | 129.849678 |
| 107 | 75 | 129.322801 |
| 108 | 75 | 128.798062 |
| 109 | 75 | 128.275452 |
| 110 | 75 | 127.754962 |
| 111 | 75 | 127.236585 |
| 112 | 75 | 126.720311 |
| 113 | 75 | 126.206131 |
| 114 | 75 | 125.694038 |
| 115 | 75 | 125.184023 |
| 116 | 75 | 124.676077 |
| 117 | 75 | 124.170192 |
| 118 | 75 | 123.66636 |
| 119 | 75 | 123.164573 |
| 120 | 75 | 122.664821 |
| 121 | 75 | 122.167097 |
| 122 | 75 | 121.671393 |
| 123 | 75 | 121.1777 |
| 124 | 75 | 120.68601 |
| 125 | 75 | 120.196315 |
| 126 | 75 | 119.708608 |
| 127 | 75 | 119.222879 |
| 128 | 75 | 118.739121 |
| 129 | 75 | 118.257326 |
| 130 | 75 | 117.777486 |
| 131 | 75 | 117.299593 |
| 132 | 75 | 116.823639 |
| 133 | 75 | 116.349616 |
| 134 | 75 | 115.877517 |
| 135 | 75 | 115.407333 |
| 136 | 75 | 114.939057 |
| 137 | 75 | 114.472681 |
| 138 | 75 | 114.008198 |
| 139 | 75 | 113.545599 |
| 140 | 75 | 113.084877 |
| 141 | 75 | 112.626025 |
| 142 | 75 | 112.169034 |
| 143 | 75 | 111.713898 |
| 144 | 75 | 111.260609 |
| 145 | 75 | 110.809158 |
| 146 | 75 | 110.35954 |
| 147 | 75 | 109.911746 |
| 148 | 75 | 109.465769 |
| 149 | 75 | 109.021601 |
| 150 | 75 | 108.579236 |
| 151 | 75 | 108.138666 |
| 152 | 75 | 107.699883 |
| 153 | 75 | 107.262881 |
| 154 | 75 | 106.827652 |
| 155 | 75 | 106.394189 |
| 156 | 75 | 105.962484 |
| 157 | 75 | 105.532532 |
| 158 | 75 | 105.104324 |
| 159 | 75 | 104.677853 |
| 160 | 75 | 104.253113 |
| 161 | 75 | 103.830096 |
| 162 | 75 | 103.408796 |
| 163 | 75 | 102.989205 |
| 164 | 75 | 102.571317 |
| 165 | 75 | 102.155125 |
| 166 | 75 | 101.740621 |
| 167 | 75 | 101.327799 |
| 168 | 75 | 100.916652 |
| 169 | 75 | 100.507173 |
| 170 | 75 | 100.099356 |
| 171 | 75 | 99.6931935 |
| 172 | 75 | 99.2886791 |
| 173 | 75 | 98.8858061 |
| 174 | 75 | 98.4845678 |
| 175 | 75 | 98.0849575 |
| 176 | 75 | 97.6869687 |
| 177 | 75 | 97.2905948 |
| 178 | 75 | 96.8958292 |
| 179 | 75 | 96.5026654 |
| 180 | 75 | 96.1110969 |
| 181 | 75 | 95.7211172 |
| 182 | 75 | 95.3327199 |
| 183 | 75 | 94.9458985 |
| 184 | 75 | 94.5606468 |
| 185 | 75 | 94.1769582 |
| 186 | 75 | 93.7948264 |
| 187 | 75 | 93.4142452 |
| 188 | 75 | 93.0352083 |
| 189 | 75 | 92.6577093 |
| 190 | 75 | 92.2817421 |
| 191 | 75 | 91.9073004 |
| 192 | 75 | 91.534378 |
| 193 | 75 | 91.1629688 |
| 194 | 75 | 90.7930666 |
| 195 | 75 | 90.4246653 |
| 196 | 75 | 90.0577588 |
| 197 | 75 | 89.6923411 |
| 198 | 75 | 89.3284061 |
| 199 | 75 | 88.9659479 |
| 200 | 75 | 88.6049603 |
| 201 | 75 | 88.2454374 |
| 202 | 75 | 87.8873734 |
| 203 | 75 | 87.5307622 |
| 204 | 75 | 87.1755981 |
| 205 | 75 | 86.821875 |
| 206 | 75 | 86.4695872 |
| 207 | 75 | 86.1187288 |
| 208 | 75 | 85.7692941 |
| 209 | 75 | 85.4212773 |
| 210 | 75 | 85.0746725 |
| 211 | 75 | 84.7294741 |
| 212 | 75 | 84.3856765 |
| 213 | 75 | 84.0432738 |
| 214 | 75 | 83.7022604 |
| 215 | 75 | 83.3626307 |
| 216 | 75 | 83.0243791 |
| 217 | 75 | 82.6875 |
| 218 | 75 | 82.3519878 |
| 219 | 75 | 82.017837 |
| 220 | 75 | 81.685042 |
| 221 | 75 | 81.3535974 |
| 222 | 75 | 81.0234976 |
| 223 | 75 | 80.6947373 |
| 224 | 75 | 80.3673109 |
| 225 | 75 | 80.0412131 |
| 226 | 75 | 79.7164385 |
| 227 | 75 | 79.3929816 |
| 228 | 75 | 79.0708372 |
| 229 | 75 | 78.75 |
| 230 | 75 | 78.4304646 |
| 231 | 75 | 78.1122257 |
| 232 | 75 | 77.7952781 |
| 233 | 75 | 77.4796166 |
| 234 | 75 | 77.1652358 |
| 235 | 75 | 76.8521307 |
| 236 | 75 | 76.5402961 |
| 237 | 75 | 76.2297268 |
| 238 | 75 | 75.9204176 |
| 239 | 75 | 75.6123635 |
| 240 | 75 | 75.3055593 |
The future value finally is computed by adding the last column here to get:
FV =
| 30559.3337 |
Therefore at the end of 20 years, the account would have: $30,559
orchestra answered 2 years agoRelated Solutions
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