Python investment

Requriements

Print all floats to 2 decimal points unless stated otherwise

You MUST use loops to solve this problem

Restrictions

No global variables may be used

Your program must have at least 1 user defined function

Description

For this problem you will be figuring out if it is more beneficial to pay off your loans first before investing or if you should only make the minimum payments and invest the rest.

Some things to pay attention to

Interest rates given are annual interests rates but we will be assuming that interest is compounded monthly so the real rates to use will be 1/12 of what we are given

We will assume that interest is compounded on our accounts before any payments or contributions are made to them

If the user has not finished paying off all of their loans before they retire a warning message should be printed

Cautions about using this program for your own investment startegies

This program assumes you are putting your money in a Roth IRA

There is an easier way to solve this problem in real life. Remind me to tell you about it.

Assumptions

Input will not always be valid

If invalid input is received your program should continue to ask for more input until a valid value is entered

While input may be invalid it will always be of the correct type

Valid values for inputs

Loans: A real number >= 0

Annual loan interest rate: a real number >= 0

Minimum payment: a real number >= 0

Investment money: A real number >= minimum payment

Current age: an integer >= 0

Retirement age: an integer >= current age

Annual rate of return: a real number >= 0

Hints

This problem has no relationship to the monthly payment formula that we did in homework 1. Don't try and use it

Don't try and look up a closed form solution to this problem. I'm not sure if there is one and the program requires you to use loops, so if you find one you couldn't use it any way

When solving this problem think about what you would do in real life when paying off your loans / savings and have your program do that as well

Make sure that you handle the month where you fully pay off your loans correctly. During that month your loans might be less than your minimum payment

Examples

Example 1

Enter how much money you owe in loans: 40000 Enter the annual interest rate of the loans: 0.03 Enter your minimum monthly loan payment: 405.32 Enter how much money you will be putting towards loans/retirement each month: 500 Enter your current age: 22 Enter the age you plan to retire at: 65 Enter your predicted annual rate of return: .05 You should only make minimum payments on your loans and invest the rest If you do you will have $592888.96 as opposed to $587281.54 when you retire.

Example 2

Enter how much money you owe in loans: 50000 Enter the annual interest rate of the loans: 0.06 Enter your minimum monthly loan payment: 350 Enter how much money you will be putting towards loans/retirement each month: 1053 Enter your current age: 25 Enter the age you plan to retire at: 70 Enter your predicted annual rate of return: 0.05 You should pay of all of your loans before you start investing If you do you will have $1651149.44 as opposed to $1619732.68 when you retire.

Example 3

Enter how much money you owe in loans: 10000 Enter the annual interest rate of the loans: .02 Enter your minimum monthly loan payment: 100 Enter how much money you will be putting towards loans/retirement each month: 500 Enter your current age: 18 Enter the age you plan to retire at: 20 Enter your predicted annual rate of return: 0.07 Warning after you retire you will still have $7961.19 in loans left. You should only make minimum payments on your loans and invest the rest If you do you will have $10272.41 as opposed to $1835.38 when you retire.

Example 4

Enter how much money you owe in loans: -3 Enter how much money you owe in loans: -2 Enter how much money you owe in loans: 25000 Enter the annual interest rate of the loans: -2 Enter the annual interest rate of the loans: -8 Enter the annual interest rate of the loans: -17 Enter the annual interest rate of the loans: .04 Enter your minimum monthly loan payment: -3 Enter your minimum monthly loan payment: 500 Enter how much money you will be putting towards loans/retirement each month: 2 Enter how much money you will be putting towards loans/retirement each month: 5 Enter how much money you will be putting towards loans/retirement each month: 300 Enter how much money you will be putting towards loans/retirement each month: 600 Enter your current age: -9 Enter your current age: 25 Enter the age you plan to retire at: 12 Enter the age you plan to retire at: 13 Enter the age you plan to retire at: 68 Enter your predicted annual rate of return: -9 Enter your predicted annual rate of return: .03 You should pay of all of your loans before you start investing If you do you will have $538083.32 as opposed to $537722.67 when you retire.