The Woodson s want to set aside 100 000 for each of their

Last updated: 2/15/2023

The Woodson s want to set aside 100 000 for each of their two children by the time each one starts college They have 6 years remaining for 1 child and 8 years for the other They started the college fund several years ago and the fund earns 7 per year and has a current balance of 75 000 How much do they need to contribute to the fund each year in total to meet their goals if they can increase their savings contributions by 3 every year Assume that the annual contributions occur at the end of the year For simplicity assume that they will withdraw the entire 100 000 for Child 1 at the end of year 6 and the entire 100 000 for Child 2 at the end of year 8 Hint Use Excel to find the starting contribution that achieves the goal and leaves the investment fund at zero after the 100 000