At age 25, to save for retirement, you decide to deposit $75 at the end of each month in an ira that pays 6.5% compounded monthly. how much will you have from the ira when you retire at age 65? find the interest.

Question

June Carpenter

Mathematics

24 December, 02:45

At age 25, to save for retirement, you decide to deposit $75 at the end of each month in an ira that pays 6.5% compounded monthly. how much will you have from the ira when you retire at age 65? find the interest.

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Daphne Wall · Answer 1

Let P = $75, r=0.0054166, n = 40. In the future worth formula, F = P ((1+r) ^ (n-1) - 1) / r, it would yield a future worth of 3,247.16 at the age of 65. And the interest rate is I = (r^n-10) / (r-1). It yields an interest of 1.033