USING TVM PRINCIPLES (Math Problem Sample)

Retirement Annuities Name Course Institution Professor Date Retirement Annuities 1. Using TVM principles, how much must you set aside each year to make sure that you hit your target goal if the interest rate is 5%? F.V = C {(1+ r) n – 1]/r] × (1 + r) F.V = Future Amount C = Annual cash I = interest rate N = Number of periods 2000000 = C (1.05)35 -1)/0.05 × (1.05) 2,000,000 = C (94.84) C = 2,000,000/ 94.84 C = 21,088.97 $ P.a 2. What flaws might exist in your calculations, and what variables could lead to different outcomes? There might exist decimal place imperfections that could alter my calculation result. Several variables like changes in the interest rates, discounts, number of periods, present value, and taxes might increase the regular amount needed to be saved to reach my target. 3. What actions could you take ensure you reach your target goal? To ensure I achieve my target goal, I should ensure to follow up regularly by reminding myself to track progress for an effective way to stay on top of my savings target goal; thus, setting up a money date will aid me in ensuring I achieve the exact target as I review my income, expense, and how much I have saved at the moment. Moreover, I should assess my finances to see my goals are running within the expected target as well as...