= { PMT [((1 + i)^n - 1) / i] } * (1 + i)
i = 0.035 / 12 = 0.00292
n = 26 years * 12 months = 312
FVad = { 250[((1.00292^312) - 1) / 0.00292] } * 1.00292
= {250[(1.48103 / 0.00292] } * 1.00292
= { 250[507.78324] } * 1.00292
= 126,945.811 * 1.00292
= $127,316.07
FYI - I kept the numbers in my calculator's memory and didn't round until the end.
3.5% interest!!!!!! Sign me up! take the $250, multiply by .035 for the 1st month. Take that amount, $258.75, and multiply it by .035 for the 2nd month and so on. Do the math yourself, young man.
This is the future value of an annuity due problem. Based on an accumulation period of 26 years, the answer is $126,277 and here is an online financial calculator to crunch the numbers:
http://www.calculatorsoup.com/calculator...
Larry is 32 years old and starting an IRA (individual retirement account). He is going to invest $250 at the beginning of each month. The account is expected to earn 3.5% interest, compounded monthly. How much money, rounded to the nearest dollar, will Larry have in his IRA if he wants to retire at age 58?
