00:01
In this question to calculate how much money you will have on the date of your retirement 45 from today we can break down the problem into several steps.
00:12
So first of all you have to calculate for each year accounting of the 4 % actual increase then calculate the 8 % of your annual salary that will be depositing into a retirement account each year then calculate the growth of your retirement account which earns 11 % per year.
00:32
Now let's calculate it step by step.
00:34
So first of all you have to calculate your salary for each year.
00:38
So initial salary is $70 ,000 and it increases 4 % each year.
00:45
So we need to find the salary of each of the 45 years.
00:49
You can use the formula like initial salary multiplied by 1 plus annual increase rate to the power n.
01:01
Now calculate your salary for each year.
01:04
So salary for each year is formula is salary for year n is equal to $70 ,000 multiplied by 1 plus 0 .04 to the power n.
01:20
Now you can plug this formula into a spreadsheet or calculator to calculate the salary for each year.
01:27
Then calculate the annual deposit of the retirement account...