Question
Your friend is celebrating her 25 th birthday today and wants to start saving for her retirement from now. She will retire at age 60.
Your friend is celebrating her 25 th birthday today and wants to start saving for her retirement from now. She will retire at age 60. On her 25 th birthday, her father just gifted her with a deposit of BDT 25 lakhs to her bank account which he had been saving for her higher studies. The bank is expected to give 8% interest compounded quarterly till her 60 th birthday. Your friend decides to save the money for her retirement. Apart from this money, your friend also plans to save an amount at the end of every month starting one month from now. Her first deposit would amount to BDT 15,000, which she plans to increase by 2% every month. She will deposit these amounts in a bank account that will give her 10% interest compounded monthly. She plans to make her last deposit on her 60 th birthday. On her 60 th birthday, your friend plans to combine money from both her bank accounts and deposit them in another bank account that is expected to pay 14% interest compounded monthly. Your friend expects to live till she is 80 years old. She expects her savings to sustain her during her retirement. What is the fixed amount of money that she can withdraw in the beginning of each month from this account so that it sustains her till she is 80?
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