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Homework answers / question archive / You currently have $2874 in a retirement savings account that earns an annual rate of return of 11
You currently have $2874 in a retirement savings account that earns an annual rate of return of 11.00% You want to retire in 45 years with $1,000,000. How much more do you need to save at the end of every year to reach your retirement goal?
Computation of Annual Savings using PMT Function in Excel:
=pmt(rate,nper,pv,-fv)
Here,
PMT = Annual Savings = ?
Rate = 11%
Nper = 45 years
PV = $2,874
FV = $1,000,000
Substituting the values in formula:
=pmt(11%,45,2874,-1000000)
PMT or Annual Savings = $694.49
