Question

The Choi family wants to save money to travel the world. They purchase an annuity with a monthly payment of $65 that earns 4.5% interest, compounded monthly. Payments will be made at the end of each month. Find the total value of the annuity in 11 years.

Answer 1

You can get an idea of how much guaranteed lifetime income a given amount of savings will buy by going to this annuity payment calculator. Today, for example, $100,000 would get a 65-year-old man about $525 a month in lifetime income, while that amount would generate roughly $490 a month for a 65-year-old woman.

Answer 2

Answer: $8966.10

Explanation:

The monthly payment with interest is 67.925. Multiply that by 12 for the 12 months in a year. You should get 815.10 as your yearly payment. And finally multiply 815.10 by 11 for the 11 years. You should get 8966.10 as your final answer. I hope this helps!