Question
Isabel has an opportunity to save $255 per month at an APR of 6.8% in a 401K plan through work. She plans to retire in
Isabel has an opportunity to save $255 per month at an APR of 6.8% in a 401K plan through work. She plans to retire in 10 years. The income taxes are at 33% for her.
(1) How much interest will Isabel have earned on her investment by the time she retires? Use Excel's FV function to help answer this question. (Express your answer rounded correctly to the nearest cent!) $
(2) What are Isabel's tax savings over the course of her investment? Review your course materials for help with this calculation. (Express your answer rounded correctly to the nearest cent!) $
(3) If Isabel's company offers a 20% matching contribution, how much would the company contribute to Isabel's 401K by the time she retires? (Express your answer rounded correctly to the nearest cent!) $
If you haven't answered the question correctly in 3 attempts, you can get a hint.
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