Suppose you want to have $700,000 for retirement in 35 years. Your account earns 4% interest. How much would you need to deposit in the account each month?
Use this formula to calculate your monthly payment:
PMT=FV / {[[1 + R]^N - 1]^/ R}
PMT =700,000 / {[1 + 0.04/12]^(35*12) - 1 / [0.04/12]}
PMT =700,000 / {[1.003333]^420 - 1 / [0.003333]}
PMT =700,000 / 913.730937.........
PMT =$766.09 - Monthly payment that you need to deposit.
