Suppose you want to have the equivalent of $45,000 in today’s dollars in the year you retire(2062). How much is this? Assume the annual inflation rate is 3.2% between now and the year you retire.

Question

Please show the steps so I can use the example for other questions !

Answer 1

assuming the current year is 2020 that is 42 years from now:

F=42000(1+.032)⁴²=$157,687.25