Question

Suppose you want to retire in 30 years with 1000000. If you earn 10% return on your money, how much do you need to deposit annually to achieve your goal?

Answer 1

you need to deposit annually is 6079.25

Step-by-step explanation:

Answer 2

you need to deposit annually is 6079.25

Step-by-step explanation:

given data

time period = 30 year

future value = 1000000

rate of return = 10 % = 0.10

solution

we will apply here future value formula that is

future value = principal ×
`((1+rate)^(time)-1)/(rate)` ........................1

put here value and we get principal amount

1000000 = principal ×
`((1+0.10)^(30)-1)/(0.10)`

solve it we get

principal = 6079.25

so you need to deposit annually is 6079.25