In: Finance
Use the data below to calculate how much the family must save each month from today (2020) until the child starts college (assuming the child will begin college at age 18) in order to have a college saving fund significant to pay for the child’s college education. You need to take into consideration the college tuition inflation rate (how much tuition cost increase each year), how long the child will be in college, and the family’s savings rate. Construct the time line of cash flows.
Must Include in Answer:
Family Name: Monroe
Child Name: Sebastian
Current Age: 10
Average Annual College Tuition, Room & Board, Textbook Cost, etc. in 2020: $12,720.00
College Inflation Rate: 6:00%
Years Expected to be in College: 2
Family Savings Rate: 8.50%