Vanessa Wants to Retire in 25 Years with Enough Saved

question 110

Multiple Choice

Vanessa wants to retire in 25 years with enough saved to be able to withdraw $5,000 monthly for 20 years. She has already accumulated $48,000 in her investment account. Assume that the rate of interest is 4.8% compounded annually for the 25 years of her contributions, and changes to 3.6% compounded monthly for the next 20 years. Determine what annual contributions she has to make for the next 25 years in order to meet her objective.

• A) $38,449.13
• B) $22,923.85
• C) $20,202.68
• D) $18,468.85
• E) $15,066.33

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