You are starting your new career today after graduating from University of Houston. You decided to contribute $500 a month into a fund that is expected to earn 6 percent, compounded monthly. If you start the contribution a month from today for 30 years, how much will you have right after you contribute the last $500 in 30 years? Round to the nearest cent. Do not include any unit (If your answer is $111.11, then type 111.11 without $ sign.)

Final Value = $502,257.52

Explanation:

Giving the following information:

You decided to contribute $500 a month into a fund that is expected to earn 6 percent, compounded monthly. You start the contribution a month from today for 30 years.

To calculate the final value, we need to use an alternative version of the final value formula:

FV = {A*[ (1+i) ^n-1]}/i

A = annual deposit = 500

n = 30*12 = 360

i = 0.06/12 = 0.005

FV = {500*[ (1.005^360) - 1]}/0.005 = $502,257.52