Drew estimates college tuition and fees, room and board, books, and other charges total $17,239. He will get a $1385 scholarship. Drew has 4 years to save. How much should he save per month to cover the costs of college (minus the scholarship) ?

Question

Brenton Payne

Mathematics

4 July, 23:24

Drew estimates college tuition and fees, room and board, books, and other charges total $17,239. He will get a $1385 scholarship. Drew has 4 years to save. How much should he save per month to cover the costs of college (minus the scholarship) ?

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Answers (1)

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Roman Simon · Answer 1

Assuming no interest rate for the amounts saved each month in the account, Drew would need to save $330.30 per month.

First, subtract the $1,385 scholarship from the total cost of college, or $17,239 to get $15,854 for the amount that needs to be saved in 4 years. Next, we start with $0 and we have 4 years to save, or 48 months (12 months/year * 4 years). You would divide the $15,854 by 48 months to find the amount that Drew must save each month, assuming that he earns no interest on the amount saved. He would need to save $330.2917, or $330.30 rounded because he cannot save $0.0017 and he needs $15,854 or more in order to attend college. The answer would change if he earns any interest on his savings, and depending on the compounding period, if any, for such interest.