{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

3232ex12-2 - 63987.85 19 30,000(F/P,6,14 67827.12 20...

Info icon This preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
3232ex12-2 Establishing a college fund during inflationary periods Investment fund will earn 8% compounded quarterly Goal: Have $30K/yr in today's dollars available for 4 years Child has just turned 5 yrs old Drawdown will occur on the 18th birthday and for 3 birthdays thereafter College rates are projected to grow at 6%/yr To establish the fund equal quarterly payments will be made over 12 years (investments start when child is 5yr-3mo) College Expenses Year 18 30,000 (F/P,6%,13)
Image of page 1
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: 63987.85 19 30,000 (F/P,6%,14) 67827.12 20 30,000 (F/P,6%,15) 71896.75 21 30,000 (F/P,6%,16) 76210.55 (F/A,2%,48)= 79.35351927 Equivalence on the 17th Birthday A (F/A,2%,48)= 63987.85 (P/F,2%,4)+ 67827.12 (P/F,2%,8)+ 71896.75 (P/F,2%,12)+ 76210.55 (P/F,2%,16) 59114.88 + 57889.79 56690.09 + 55515.26 A 79.35351927 = 229210.02 A= 2888.47 Quarterly Payment College Expense - Today's Dollars Conversion to Actual College Expense Actual Expense...
View Full Document

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern