College Savings Example 2 (Annuitization)

College Savings Example 2 (Annuitization) - year for...

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College Savings Example 2 (Annuitization) An expectant father wants to know how much he’d have to put in the bank on each of his daughter’s birthdays so her college education will be paid for by time she goes off to school. Based on recent cost data for 4-year public schools, he expects to pay $19,000 per
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Unformatted text preview: year for tuition, room, and board. Assume these costs are incurred during the 18 th , 19 th , 20 th , and 21 st years and the money is invested in stocks that yield 6% above the inflation rate on average. Assume he makes the first payment on the day she is born....
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