You have $40,549.50 in a brokerage account, and you plan to deposit an additional $3,000 at the end of every future year until your account totals $210,000. You expect to earn 11% annually on the account. How many years will it take to reach your goal? Round your answer to the nearest whole number.

Question

Business

Augustus George

18 November, 04:29

You have $40,549.50 in a brokerage account, and you plan to deposit an additional $3,000 at the end of every future year until your account totals $210,000. You expect to earn 11% annually on the account. How many years will it take to reach your goal? Round your answer to the nearest whole number.

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Answers (1)

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Warren Thornton · Answer 1

It will take 25.12 or 25 years to reach the desired goal.

Explanation:

Given:

Amount in brokerage account which is the present value = $40,549.5

Additional annual deposits which is PMT or payment = $3,000

Rate of interest = 11% or 0.11

Desired goal or future value = $210,000

Use excel function (nper) to calculate number of years required to achieve desired goal.

Formula is = NPER (rate, pmt, PV, FV)

The same is calculated in the following excel.

Therefore, it will take 25 years to achieve desired goal.