Question: Abebi who has just celebrated her 29th birthday will retire

Abebi, who has just celebrated her 29th birthday, will retire on her 55th birthday, and she has just set up a retirement plan to pay her income starting on her retirement day, and to continue paying for 19 more years. Abebi's goal is to receive $120,000 for each of these twenty years. In creating her retirement account, Abebi has committed to set aside equal payments at the end of each year, for the next 25 years starting on her 30th birthday. If the annual interest rate is 9%, how big should Abebi's equal payments be? (Enter just the number without the $ sign or a comma; round off decimals.)

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  • CreatedAugust 26, 2013
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