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14: Additional Examples 207
File name : 17BII-Plus-Manual-E-PRINT-030709 Print data : 2003/7/11
Example: Tax-Free Account. Consider opening an IRA account with a
dividend rate of 8.175%. 1) If you invest $2,000 at the beginning of
each year for 35 years, how much will you have at retirement? 2) How
much will you have paid into the IRA? 3) How much interest will you
have earned? 4) If your post-retirement tax rate is 15%, what is the
after-tax future value of the account? Assume only the interest will be
taxed. (Assume the principal was taxed before deposit.) 5) What is the
purchasing power of that amount, in today’s dollars, assuming an 8%
annual inflation rate?
Keys: Display: Description:
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]
.
1
Y
Z
e
"
"
"
# 5?@2 JH=;< 0EAH"
Sets 1 payment per year
and Begin mode.
35
T
<8%.&(("
Stores number of payment
periods until retirement (1
× 35).
8.175
U
;6@28*&#*"
Stores dividend rate.
0
V
5O8(&(("
Present value of account
(before first payment).
2000
&
W
"
50:8/$K(((&(("
Annual payment
(deposit).
X
GO8%*-K'+(&+."
Calculates amount in
account at retirement.
R
W
*
R
T
=
"
"
/-(K(((&(("
Calculates total amount
paid into IRA by
retirement.
+
R
X
=
"
%#-K'+(&+."
Calculates interest you
will earn.
v
v
v
v