Ross has decided that he wants to build enough retirement wealth that, if invest

Question

Ross has decided that he wants to build enough retirement wealth that, if invested at 5 percent per year, will provide him with $5,000 of monthly income for 30 years. To date, he has saved nothing, but he still has 20 years until he retires.

How much money does he need to contribute per month to reach his goal? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

How much money does he need to contribute per month to reach his goal? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

Explanation / Answer

PMT = 5000, FV = 0, N = 360, rate = 5%/12

use PV funciton in Excel

retirement corpus = 931,408.0852

FV = 931,408.0852, PV = 0, N = 5%/12, N = 240

use PMT funciton in Excel

contribution per month = 2,266.01

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