Dean is planning to purchase a new NissanAltimawhich costs$26,865.He has saved up $3,200 to put toward it.He is thinking about getting a loan for it from his credit union, but he could also keep driving his beat-up old car for a while longer and save up cash for the new one.

Dean would like to get the car soon, but he wants to at least look into the option of saving up and paying cash for the car so he doesn't have to pay so much for interest.

Possibility Two: Saving Up

Assume Dean puts his $3,200 in his savings account, which has an APR of 1.2%.You've already determined how much he needs to add to the accountevery month in order to have all $26,865 saved up to pay cash for the car in five years.If Dean decides to do it how much of his own money will he have put into the savings account to pay for his car? Don't forget the initial deposit as well as the monthly payments.