Problem 5-57 Spreadsheet Problem (LG2, LG9)
Consider a person who begins contributing to a retirement plan at age 25 and contributes for 40 years until retirement at age 65. For the first ten years, she contributes $2,400 per year. She increases the contribution rate to $4,400 per year in years 11 through 20. This is followed by increases to $9,400 per year in years 21 through 30 and to $14,400 per year for the last ten years. This money earns a 10 percent return.
First compute the value of the retirement plan when she turns age 65. (Round your answer to 2 decimal places.)
Value $
Compute the annual payment she would receive over the next 40 years if the wealth was converted to an annuity payment at 9 percent. (Round your answer to 2 decimal places.)
Annual payment $
Problem 5-57 Spreadsheet Problem (LG2, LG9)
| Consider a person who begins contributing to a retirement plan at age 25 and contributes for 40 years until retirement at age 65. For the first ten years, she contributes $2,400 per year. She increases the contribution rate to $4,400 per year in years 11 through 20. This is followed by increases to $9,400 per year in years 21 through 30 and to $14,400 per year for the last ten years. This money earns a 10 percent return. |
| First compute the value of the retirement plan when she turns age 65. (Round your answer to 2 decimal places.) |
| Value | $ |
| Compute the annual payment she would receive over the next 40 years if the wealth was converted to an annuity payment at 9 percent. (Round your answer to 2 decimal places.) |
| Annual payment | $ |
Related questions
Consider a person who begins contributing to a retirement plan at age 25 and contributes for 40 years until retirement at age 65. For the first ten years, she contributes $2,400 per year. She increases the contribution rate to $4,400 per year in years 11 through 20. This is followed by increases to $9,400 per year in years 21 through 30 and to $14,400 per year for the last ten years. This money earns a 10 percent return
First compute the value of the retirement plan when she turns age 65.
| Compute the annual payment she would receive over the next 40 years if the wealth was converted to an annuity payment at 9 percent |
