As part of his retirement planning, your uncle has been offered a security that promised to pay $50,000 at the end of each of the next 20 years. If the interest rate is 6%, how much should he be willing to pay for this security?
Value of the Security =
You want to be a millionaire when you retire in 60 years. You plan to make 60 equal annual contributions to your investment account starting today, and the last contribution will be made 59 years from today. If your investment account pay 6% interest every year, how large must each annual contribution be?
Required Annual Contribution =
Your daughter was just born today, so that means its time to start saving for her college education. You plan to make 18 annual payments (starting today) of $3000 each year on her birthday (the last coming on her 17th birthday). You will withdraw the money on her 18th birthday (no payment will be made this day) and write check to the college of her choosing. If you expect an average investment return of 8%, how will you have saved up for her college tuition?
Total College Savings =