You are saving for your child's college education. Your child will start college in 16 years, and
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Question:
After panicking, you realize that your salary should grow over time, so it will make sense to also grow your contribution to the college account. You estimate your salary will grow about 0.75% per month, so you want to commit to grow your college contribution at that same rate.
Scenario 1: Optimistic - tuition charges grow at the general inflation rate of 2.4% per year, compounded monthly.
Scenario 2: Pessimistic - tuition charges grow at the recent education inflation rate of 6.4% per year, compounded monthly.
What will be your first monthly payment under this plan for each of the two scenarios?
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
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