Bilbo Baggins wants to save money to meet three objectives . First , he would like to be able to retire 30 years from now with retirement income of $ 26,000 per month for 30 years , with the first payment received 30 years and 1 month from now . Second , he would like to purchase a cabin in Rivendell in 10 years at an estimated cost of $ 256,000 . Third , after he passes on at the end of the 30 years of withdrawals , he would like to leave an inheritance of $ 650,000 to his nephew Frodo . He can afford to save $ 1,600 per month for the next 10 years . If he can earn a 10 percent EAR before he retires and a 8 percent EAR after he retires . how much will he have to save each month in Years 11 through 30 ?