Complex annuity Upon graduating from college 40 years ago Dr

?(Complex annuity?) Upon graduating from college 40 years? ago, Dr. Nick Riviera was already thinking of retirement. Since then he has made deposits into his retirement fund on a weekly basis in the amount of $35. Nick has just completed his final payment and is at last ready to retire. His retirement fund has earned 9.29?% interest compounded weekly.

a. How much has Nick accumulated in his retirement? account?

b. In addition to all? this, 20 years? ago, Nick received an inheritance check for $20,000 from his beloved uncle. He decided to deposit the entire amount into his retirement fund. What is his current balance in the? fund?

Solution

a). Put the following figures in the financial calculator:

n = 40 x 52 = 2,080

I/Y = 9.29/52 = 0.1787

PMT = 35

PV = 0

CPT FV = $782,925.77

b). The amount the $20000 inheritance check has accumulated to over 20 years is

n = 20 x 52 = 1040

I/Y = 0.1787

PV = -20000

PMT = 0

CPT FV = $128,005.67

Current Balance of Nick\'s retirement fund = $782,925.77 + $128,005.67 = $910,931.44