Texas Instruments Avigo, User Manual

Page: 19 / 132

10 Financial Calculator User’s Guide
Computing Retirement Savings
Jo is 25 years of age and wants to retire at the age of 55. In order for Jo to save
$750,000 for retirement, how much should Jo save per month? (Assume a 6.25%
savings account interest rate.)
Procedure Keystrokes Display
Move to the third screen.
ñ
Third screen
Select Annual Percentage
Rate. Tap on
Œ
or accept
the default.
APR is selected
Select 12 payments per
year. Tap on the Payments/year
input box and tap on 12,
ö
or accept the default of 12.
Payments/year: 12
Select 12 compoundings
per year. Tap on the Compounds/
year input box and tap on
12,
ö
or accept the default
of 12.
Compounds/year: 12
Select payments to be
made at the End. Tap on
Š
or accept
the default.
Payments made at: End
Select two decimal places. Tap on 2 or accept the
default of 2 .
Decimal place: 2
Return to the first screen. Tap on
Ñ
twice. First screen
Enter a future value of
$750,000. Tap on the
…
input
box and tap on 750000,
ö
.
… 750,000.00
Leave
„
and
†
set
to zero.
„ 0.00
† 0.00
Enter the 6.25% interest
rate per year. Tap on the
‡
input
box and tap on 6.25,
ö
.
‡ 6.25
Enter the total number of
payments required.
((55-25)*12) Tap on the
ˆ
input
box and tap on 360,
ö
.
ˆ 360.00
Solve for Payment. Tap on
„
. „
711.63
As you can see, in order for Jo to retire at the age of 55 with the anticipated sum
of money, Jo will have to save $711.63 per month for 30 years. Finally, let’s look
at someone with the exact opposite problem; how to spend it all.