Question

In: Finance

When you retire, your company promises to pay you $1500 a month for 25 years. What...

When you retire, your company promises to pay you $1500 a month for 25 years. What is the value of this retirement annuity to you today, assuming 3%?

Solutions

Expert Solution


Related Solutions

Homework 2 When you retire you expect to live for another 25 years. Each month of...
Homework 2 When you retire you expect to live for another 25 years. Each month of your retirement you want to be able to withdraw $8,500 for living expenses. If you can earn 4.5% per year on your investment, how much do you need to have in your retirement account, at the time you retire, to make this happen?
You’ve decided that you want $1,000,000 in your investment account when you retire 25 years from...
You’ve decided that you want $1,000,000 in your investment account when you retire 25 years from today. If you already have $100,000 in the account, and it earns a nominal rate of 8% per year, compounded quarterly, how much money will you have to deposit into that account per year in order to reach your goal?
Assume you are now 25 years old. You plan to retire when you are 65 years...
Assume you are now 25 years old. You plan to retire when you are 65 years old. You think you will live until you are 80 years. a.) If the rate of return during your working years (a.k.a. the "savings period") is 8% and you plan to save $2,000 per year, how much will you have saved up by retirement age? b.) If the rate of return during your retirement is 6% on the amount of savings you have accumulated,...
Assume that Social Security promises you $45,000 per year starting when you retire 45 years from...
Assume that Social Security promises you $45,000 per year starting when you retire 45 years from today? (the first $45,000 will get paid 45 years from? now). If your discount rate is 7 % compounded? annually, and you plan to live for 17 years after retiring? (so that you will receive a total of 18 payments including the first? one), what is the value today of Social? Security's promise?
You are now 25 years old. You would like to retire when you are 65 years old.
You are now 25 years old. You would like to retire when you are 65 years old. You want to receive starting at 65 an annual income of $150,000 per year until you are 95. How much money must you have in your retirement account when you are 65? Assume you can earn 4% per annum.
You will retire in 30 years. At the beginning of each month until you retire, you...
You will retire in 30 years. At the beginning of each month until you retire, you will invest X earning interest at 9% convertible monthly. Starting at year 30, you will withdraw $4,000 at the beginning of each month for the next 15 years. Also, starting at year 30, your fund will only earn interest at 6% convertible monthly. Find X such that your account will be empty after the last withdrawal.
You are considering an investment that promises to pay $500every week for 2 years with...
You are considering an investment that promises to pay $500 every week for 2 years with the first payment made immediately. If the opportunity cost of the investment is 10% p.a. compounded quarterly, what is the investment’s value today?
You want to start saving for retirement. Your goal is to retire in 25 years. Assume...
You want to start saving for retirement. Your goal is to retire in 25 years. Assume that you have $25,000 to invest now and that you will contribute $4,800 per year. What will your account be worth when you retire if you can earn 6% a year? What will your account be worth if the 6% annual return is compounded monthly and instead of contributing $4,800 per year, you contribute $400 monthly (you still start with $25,000) Assume all payments...
Your current salary is $52,000 per year, and you are planning to retire in 25 years...
Your current salary is $52,000 per year, and you are planning to retire in 25 years from now. She anticipates that her salary will increase $3,000 each year, and she plans to deposit 5% of her yearly salary into a retirement fund that earns 7% interest compounded daily. What will be the amount of interest accumulated at the time of your retirement?
Today is your 30th birthday and you plan to retire in 30 years when you are...
Today is your 30th birthday and you plan to retire in 30 years when you are 60. You expect to need $75,000 a year in retirement (the first $75,000 will be paid on your 61st birthday) and expect to live to be 95. If you assume you can earn a nominal rate of 5.5% on your investments calculate the amount you will need to save each year until you retire if you start saving next year on your 31st birthday....
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT