I have $400,000 in the bank now. I plan to withdraw $20,000 at the end of...

I have $400,000 in the bank now. I plan to withdraw $20,000 at the end of this year. Each subsequent end of year withdrawal will increase by 8%. If I earn 10% per year on my investments in the first 3 years, then 5% per year in the next 2 years, and 4% per year in the following 3 years,
1. Determine how much money I will have at the end of 8 years.
2. Determine the initial withdrawal amount at the end of this year that will leave me with no money at the end of 8 years using either Solver or Goal Seek.

Expert Solution

So Amount at the end of 8 years = $ 392,594.18

b)

Using goal seek

So, Initial Withdrawal amount has to be $ 49,334.37 for the money be 0 at the end of 8 years.

Formulae

jeff jeffy answered 1 year ago

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