A retiree receives a payout from his Roth IRA where the taxes have already been paid.
He wants to take out 10% of the original amount at the beginning of each year for living expenses. The remaining money will earn 6% interest. How long before the money runs out?
For example, he starts with $400,000 and takes out $40,000 each year. The first year the interest would equal $360,000 * 6% or $21,600. So the second year would start with $381,000.
If you have a formula to put in a spreadsheet, it would help.
The question does not say 10% of current value, it says 10% of original value. You have to read the whole thing.
Posts Tagged ‘Math’
Annuity Math Question?
27
Jul
Help me with math – annuities?
01
Jul
I’m having trouble with my math homework, could someone please explain to me how to get the answer, and possibly the answer to some of these questions please help ty!!
1) Find the future value (FV) of the ordinary annuity, $125 monthly payment, 5% interest, 1 year. (Round your answer to the nearest cent.)
2) Find the future value (FV) of the ordinary annuity, $180 monthly payment, 6.75% interest, 14 years. (Round your answer to the nearest cent.)
3) Find the monthly payment (pymt) that will yield ordinary annuity $95,000 at interest 10% for 30 years. (Round the answer to the nearest cent.)
4) Find the monthly payment (pymt) that will yield ordinary annuity $255,000 at interest 10% for 43 years. (Round the answer to the nearest cent.)
5) Toni Torres wants to save $1,100 in the next two years to use as a down payment on a new car. If her bank offers her 10% interest, what monthly payment (pymt) would she need to make into an ordinary annuity to reach her goal? (Round cent)
Also,
6) Fred and Melissa Furth’s daughter Sally will be a freshman in college in six years. To help cover their extra expenses, the Furths decide to set up a sinking fund of $13,000. If the account pays 8.3% interest and they wish to make quarterly payments, find the size of each payment (pymt). (Round the answer to the nearest cent.)
Thanks very much.
Math questionn!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! (annuity terms)?
01
Jun
Which of the following annuity terms best match each of the statements below?
A annuity
B sinking fund
C ordinary annuity
D increasing annuity
E annuity due
F None of the above
An annuity where payments are made at the end of the time period.
An annuity set up to increase in value over an unspecified number of time periods.
sequence of equal payments made at equal time periods.
An annuity created for a particular amount to be available at a specified future time.
An annuity created at the beginning of a period to withdraw funds over equal time periods in the future.
An annuity where payments are made at the beginning of the time period.
THANKs!
math help explain please?
31
May
Find the present value of an ordinary annuity with payments of $800 per month at 6% compounded monthly for 4 years.
B.) You want to take out a loan to buy a new car for which you need to finance $9923. Your bank will give you a loan at 5% compounded monthly. You look at your budget and decide that you can afford a payment of $293 a month. How many years, to the nearest tenth of a year, must the loan be taken out to meet these conditions?
Explain your work.
Math interest question.?
29
May
Okay so I am going to try and explain this the best I can. I am doing a math ISU on simple interest, compound interest and annuities. The first two were going well but the annuities are giving me some problems. There are two questions that relate to one another, the first one is asking if a guy wants to buy a car in 7 years that costs $30,000 and is adding money to the bank every month and is getting 8% interest on it how much does he need to add every month in order to make this happen. I was able to figure this out alright, he would have to put in $267.18 a month. The next question asks me to go on a banks website and find a real interest rate, I went on TD Canada trust and the rate I got was if below $4999.99 in the account then 0.050% interest but if above $5000 then 0.250% interest. I was able to find out that he would have to put in $ 354.47 dollars a month. My question is though, that when using the formula A=R[(1+i)^n-1] over i, what am I putting into i, which interest, the one for under $4999.99 or the one for above $5000?
Math Help!?
20
May
please show your work:
#1 What is the total after 7 years of an initial investment of $2250 that earns interest at the rate of 6%, compounded monthly?
If your feeling ambitious:
#2 Rosita deposits $250 each month into a retirement account that pays 6.00% APR (0.50% per month). What is the value of this annuity after 20 years?
If you are really smart and ambitious:
#3 Let S= a(1.08)^t. Solve for t. (multiple choice no need to show work)
Lastly:
#4 Use the properties of logarithms to write the expression 3log(x+8) – 2log(x – 5) as a single logarithm.
Thank You so much! Person to submit the most answers in best way will get 10 points. (Just submit 1 answer and then keep solving more)-tip
Can someone help me with my math homework?
14
May
1730 is used to purchase an annuity consisting of equal payments at the end of each quarter for the next 7 years. The interest rate is 5% compounded quarterly. Find the amount of each payment.
how do i differentiate between normal annuity questions and present value of annuity questions in math? URGENT
09
May
i cant seem to get it….
1. logan retires in 4 years. he has plans to take a trip to australia. he estimates it will cost him $8000 for trip. how much money should he invest every six months if the investment earns 6% per annum compounded annualy?
2. A giant screen television set is on sale for $3400. it can be purchased on the installment plan for 3 years, each payment to be made at the end of each month. if interest is 10% compounded monthly , determine the regular monthly payment.
now 1st of all how do i differentiate which 1 is annuity and which 1 is PV annuity? cuz both r monthly payments….plz im so confused about this..i did good on my quiz but i frgot how to do this and i have an exam 2morrow…plez help help help!!! if u have a website for questions like these plz link em..plz plz plz!!!
Math Formula Help?
04
May
Alright, here is the question:
Bob is considering two different investment structures for his IRA. One structure has him pay $500 each month into an account with an APR of 7.2%. The second structure has him pay $1500 every quarter into an account with an APR of 7.3%. Which structure will give Bob a better return on his investment in 30 years? In 5 years?
Okay, my question is do I use a compound interest formula, or an annuity formula? I do not need the actual problem solved, just which formula to use. : )
Annuities and Mortgages math questions?
03
May
Marie bought a house for $151,000. She put down 10% in cash and financed the rest with a 30-year mortgage at 6.3% annual interest.
1. What are her montly payments?
2.If she repays the entire loan as planned, what is the total amount she will have repaid?
Math Annuities Question?
29
Apr
You won 500 000 in the lottery. You decide to buy an annuity to pay you a certain amount every 6 months for 20 years. The bank agrees to pay you 6%/a compounded semi annually. How much will your regular payout be?
Business math annuity help. thank you so much?
28
Apr
P and J are divorced. The devorce settlement stipulated that J pay $525 a month for their children Sue untile turns 8 in 4 years. How much must J set aside to day to meet the settlement? interest 6% a year.
@ RobertM : i do not how to replay for you. But i just figured it out.Yes, It does make sense. This is the problem of Present value of annuity. The result is J has to set $22,354.71 aside from now to meet the settlement.
just Sue only.i’m sorry, i typed wrong.thank you Robert.
until she turns 18. not 8
Help with math statistics?
26
Apr
A company that sells annuities must base the annual payout on the
probability distribution of the length of life of the participants in the plan. Suppose the probability distribution of the lifetimes of the participants is approximately a normal distribution with a mean of 68 years and standard deviation of 3.5 years. What proportion of the plan receipts would receive payments beyond age 75?
A. 0.1949 B. 0.0228 C. 0.5134 D. 0.7768
There are 2,000 eligible voters in a precinct. Despite protests from Knowledgeable persons that a sample size of 500 was too large in relation to the total, the 500 selected at random were asked to indicate whether they planned to vote for the Democratic incumbent or the Republican challenger. Of the 500 surveyed, 350 said they were going to vote for the Republican incumbent. Using a 0.99 confidence level, what are the confidence limits for the proportion that plan to vote the Republican incumbent?
A. 0.826 and 0.926 B. 0.397 and 0.797
Math problem? Equate pension value to hourly wage.?
23
Apr
For example, let’s say one works for abc corp:
Retires after 35 years
Is paid $100 per month x 35 years worked for a total of $3500/mo for life with no adjustment for inflation. Let’s assume payment for 30 years.
What is the best way to incorporate the benefit of this pension to an hourly wage based on a 40 hour week, 50 weeks a year?
Let’s say our worker made $10/hr in 1972 and finished at $25/hr in 2007. This shouldn’t matter, but I’m looking for the extra hourly rate this type of pension would cost.
I think you could find the cost of a comparable annuity in todays dollars that would provide the same life benefit for a starting point.
Thank you in advance math whizards
can someone walk me through these 2 math annuity problems?
22
Apr
I know it sounds easy, but I need help on this.
The problem goes like this:
Find the value of each of the following annuities?
$1000 a quarter at 6% for 15 years.
Also another problem
Find the payment needed to accumulate the following amounts?
$1500 with weekly payments at 5.5% for 2 years.
I know this sounds simple but this section in my math book gave a lot of formulas and I don’t know which one to use! Can someone show me how to set the numbers up? Thanks!