don't know how to use calculator (split from 2008 thread)

[mrfluffy122]

Hints (3 different Present Values required):

PV1 = 10000/1.13^10 + 11000/1.13^11 + 12000/1.13^12 + 13000/1.13^13

PV2 = 15000/1.13^15 + 16000/1.13^16 + 17000/1.13^17 + 18000/1.13^18

PV3 = [50000(1 - 1/1.13^20)/.13] / 1.13^30

P = PV1 + PV2 + PV3

The required annual deposit over 30 years:
P(.13) / (1 - 1/1.13^30)

If you can't follow that, you're not ready for this...

Hey Denis, I understand how to do this by hand with formulas, but I do not understand how to do it on my financial calculator. I understand how to get the FV required for the 20 payments (351,237.58), however do not understand how to incorporate the cash flows for the college payments. If you could briefly explain how I would go about doing it that would be great. I'm using a HP 17bII+. I know I need to figure out the NPV of the two funds, but I'm not sure if they should be separate or together, and how to incorporate them into the problem. Thanks!

 

[stapel]

The original thread, from 2008, involved this question:

---

You have just had your 30th birthday. You have two children. One will go to college 10 years from now and require four yearly payments for college expenses of RM10,000, RM11,000, RM12,000 and RM13,000. The second child will go to college 15 years from now and require four yearly payments for college expenses of RM15,000, RM16,000, RM17,000 and RM18,000. In addition, you plan to retire in 30 years. You want to be able to withdraw RM50,000 per year from an account throughout your retirement. You expect to live 20 years beyond retirement. The first withdrawal will occur on your 61st birthday. All savings earn a 13% annual rate of return.

What equal, annual amount must you save for each of the next 30 years in order to meet these goals?

---

The original thread is here.

Note to "MrFluffy": We help with math; we don't do tech support for Hewlett-Packard. To learn how to use your calculator, try checking your owner's manual. Or, if you've misplaced the manual, try downloading a copy from the manufacturer's website.