A Couple Puts $500,000 for Their Retirement into an Account $s_{n}$

question 30

Short Answer

A couple puts $500,000 for their retirement into an account paying 5% annual interest.They estimate that they will need to withdraw $60,000 each year to live on.Assume that the $60,000 is withdrawn on the last day of the year.Find a recursive formula for $s_{n}$ , the amount of money left in the account at the end of n years, and use it to determine how many years the money will last (how many years until there is less than $60,000 in the account).

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Definitions:

Lumen

The internal area of a hollow organ, like a blood vessel or the gut.

Vestibule

An entrance hall or other open area in a building used by the public, especially a hotel or theater; in anatomy, it refers to the entrance of many structures in the body such as the mouth or ear.

Labia Minora

The inner folds of skin located at the entrance of the female genitalia, playing a role in protecting the vaginal and urethral openings.

Urethra

The duct through which urine is discharged from the bladder in both sexes and through which semen is discharged in males.