Click here to read the eBook Finding the Number of Years N 8

Click here to read the eBook: Finding the Number of Years, N 8, 9. 10. TIME TO REACH A FINANCIAL GOAL You have $24,777.65 in a brokerage account, and you plan to deposit an additional $4,000 at the end of every future year until your account totals $210,000. You expect to earn 13% annually on the account. How many years will it take to reach your goal? Round your answer to two decimal places at the end of the calculations. O years

Solution

Current Balance = $24,777.65
Annual Deposit = $4,000
Desired Balance = $210,000
Annual Interest Rate = 13%

Let it will take n years to accumulate desired balance

$24,777.65 * FV of $1 (13%, n) + $4,000 * FVA of $1 (13%, n) = $210,000

Using financial calculator:
I = 13%
PV = -24777.65
PMT = -4000
FV = 210000

N = 12

So, it will take 12.00 year to accumulate the desired balance.