Financial Math Question

Question

Walter decides he wants to start saving for retirement. On his 35th birthday he deposits $130000 in an account with an interest rate of j1=6%. On his 65th birthday he starts withdrawing money annually from the account for the next 12 years (That is, he makes 12 withdrawals). What size are the withdrawals?

Answer 1

Alex,

Take a look at the video and let me know if you have any questions. For more details on why I had the compounding factor, go here: https://corporatefinanceinstitute.com/resources/knowledge/finance/compound-interest-formula/

For more information on goal seek, see this link:

https://www.excel-easy.com/examples/goal-seek.html

I wanted to focus on the Excel rather than the theory.

Habib