Annuity that pays 6.6% compounded monthly. If $950 is deposited into this annuity every month, how much is in the account after 7 years? How much of this is interest?
Let's assume payments are made at the end of each month, since the problem does not state it. We have an annuity immediate formula. Interest rate per month is 6.6%/12 = .55%, or 0.0055. 7 years * 12 months per year gives us 84 deposits.
Using our present value of an annuity immediate calculator, we get the following:
Let's assume payments are made at the end of each month, since the problem does not state it. We have an annuity immediate formula. Interest rate per month is 6.6%/12 = .55%, or 0.0055. 7 years * 12 months per year gives us 84 deposits.
Using our present value of an annuity immediate calculator, we get the following:
- Accumulated Value After 7 years = $101,086.45
- Principal = 79,800
- Interest Paid = (1) - (2) = 101,086.45 - 79,800 = $21,286.45