Wednesday, September 15, 2010

Number 13 Solution

QUESTION:
Forrest wants to have $250,000 saved by the age of 40 so that he can travel for 5 years. He currently had $5,000 invested and plans to invest money every month into an account that gives a 9.3% rate of return. How much should he invest if inflation is estimated to be 2.6% per year over that period?

ANSWER:
He invests $535.52 monthly.

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