Solve your doubts and expand your knowledge with IDNLearn.com's extensive Q&A database. Get comprehensive and trustworthy answers to all your questions from our knowledgeable community members.

Isaiah is in his 50s and currently does not have a retirement fund. However, he recently read a few articles about the insufficient savings of people in retirement and, as a result, he decides he wants to start now. He saves $500 per month for 15 years and earns 7% by investing in the stock market through an index fund.

Sagot :

Answer:

Future Value= $158,475.64

Explanation:

Giving the following information:

He saves $500 per month for 15 years and earns 7% by investing in the stock market through an index fund.

I assume we have to determine the value of the investment at the time of retirement.

We need to use the following formula:

FV= {A*[(1+i)^n-1]}/i

A= monthly deposit= 500

n= 15*12= 180

i= 0.07/12= 0.005833

FV= {500*[(1.005833^180) - 1]} / 0.006833

FV= $158,475.64

We appreciate your participation in this forum. Keep exploring, asking questions, and sharing your insights with the community. Together, we can find the best solutions. Your questions find answers at IDNLearn.com. Thanks for visiting, and come back for more accurate and reliable solutions.