Mr. Haddit plans to retire eight years from today. He projects that he will need $30,000 per year in his retirement which he assumes will be for 15 years. The first payment will be nine years from today. To fund his retirement, Mr. Haddit will invest a lump amount today and later use it to sustain the 15 withdrawals. If his investment earns 6% compounded annually, how much must he invest today?

Question

Quizplus · Accepted Answer

The Answer of Mr. Haddit plans to retire eight years from today. He projects that he will need $30,000 per year in his retirement which he assumes will be for 15 years. The first payment will be nine years from today. To fund his retirement, Mr. Haddit will invest a lump amount today and later use it to sustain the 15 withdrawals. If his investment earns 6% compounded annually, how much must he invest today?

Mr Haddit Plans to Retire Eight Years from Today