We want to become millionaires attaining $2 million. Our 5^th birthday is today, and our grandparents give us $10,000, which we invest at 5% interest rate. Additionally, they give us $4,000 for as long as we need it to attain our goal. Our retirement will start in 65 years last for 25 years and needs $70,000 per annum. We shall pay for a 4-year degree from our pocket in 13 years at $20,000 per annum. In year 8, we take a vacation to the Greek islands, and it costs us $26,000. How old shall we be when we attain our goal?

Important Note:

This question is poorly worded by my professor. To be clear, so there is no confusion, the $4,000 that our grandparents give us to attain our goal is monthly, not yearly. Also, the $2 million is only for 2 people. And, the retirement amount is not required apart from the $2 million. I hope this helps.

I talked to my friend and this is the instructions that he gave me:

Step 1: find value of all expenses (college and vacation) in year 65.

Step 2: Present value of the retirement income in year 65.

Step 3: Total amount of pension fund in year 60 to finance these expenses and retirement

Step 4: Find the saving amount in year 65

Step 5: If she become a millionaire in year 65, we can check. But she could not become millionaire. So, it is imposible to becaome millionaire after year 65.

Within the 25 years, they're going to have a contingency of $250,000 from the $2M due to the fact they're only spending $70k/year. To spend the $2M in it's entirety, they would have to spend $70,000/year

If you calculate only the value of the deposit and annuity, they will have $2M before 65. But, because of the cost of vacation and college, they will not have $2M before 65. So, they will not have $2M at any time.

I hope these instructions help you find the solution because I am having trouble. Please, I beg you, show the full work, so I can follow it and understand it more clearly because this is for a take home test. It is very important. Thank you.