Question
Daryl wishes to save money to provide for his retirement. Beginning one year from now, Daryl will begin depositing the same fixed amount each year
Daryl wishes to save money to provide for his retirement. Beginning one year from now, Daryl will begin depositing the same fixed amount each year for the next 30 years into a retirement savings account. Starting one year after making his final deposit, he will withdraw $100,000 annually for each of the following 25 years (i.e. he will make 25 withdrawals in all). Assume that the retirement fund earns 12% annually over both the period that he is depositing money and the period he makes withdrawals. In order for Daryl to have sufficient funds in his account to fund his retirement, how much should he deposit annually (rounded to the nearest dollar)?
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