Question
Future value of a portfolio. Rachel and Richard want to know when their current portfolio will be sufficient for them to retire. They have the
Future value of a portfolio.
Rachel and Richard want to know when their current portfolio will be sufficient for them to retire. They have the following balances in their portfolio:
Money market account (MM): $33,000
Government bond mutual fund (GB):$130,000
Large capital mutual fund (LC):$106,000
Small capital mutual fund (SC):$71,000
Real estate trust fund (RE):$88,000
Rachel and Richard believe they need at least $2400 to retire. The money market account grows at 3.0 % annually, the government bond mutual fund grows at 5.5% annually, the large capital mutual fund grows at 8.5 %, annually, the small capital mutual fund grows at 13.5 % annually, and the real estate trust fund grows at 3.0 % annually. With the assumption that no more funds will be deposited into any of these accounts, how long will it be until they reach the $2,400.00 goal?
Rachel and Richard will need to invest their accounts for ???????????? or more years to reach $2400,00.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started