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#1
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NPER - Retirement Example
All,
I'm trying to calculate how many months I could draw on my retirement funds. Here's the example: Present Value of Fund: 900,000 Amount deducted each month: 6,000 Expected rate of return on investment: 10% I tried to use NPER = (.10/12, -6000, 900000) but get an error. If I make both signs negative, I get 111, which I know the answer should be bigger. Thoughts? |
#2
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If the expected rate of return is 10% then the first month you will make as
interest 7500 (900K*10%*1/12) and what you deduct is only 6000 Therefore you will never exhaust you funds infact they will keep growing. That is why you get an error as period is = infinity however using a 4% return and using the following formula I get the CORRECT result of 208 months =NPER(4%/12,-6000,900000) "mschumacker" wrote in message ... All, I'm trying to calculate how many months I could draw on my retirement funds. Here's the example: Present Value of Fund: 900,000 Amount deducted each month: 6,000 Expected rate of return on investment: 10% I tried to use NPER = (.10/12, -6000, 900000) but get an error. If I make both signs negative, I get 111, which I know the answer should be bigger. Thoughts? |
#3
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I should have realized. Thanks for the answer. Sometimes the obvious
answers are the hardest to come by. "N Harkawat" wrote: If the expected rate of return is 10% then the first month you will make as interest 7500 (900K*10%*1/12) and what you deduct is only 6000 Therefore you will never exhaust you funds infact they will keep growing. That is why you get an error as period is = infinity however using a 4% return and using the following formula I get the CORRECT result of 208 months =NPER(4%/12,-6000,900000) "mschumacker" wrote in message ... All, I'm trying to calculate how many months I could draw on my retirement funds. Here's the example: Present Value of Fund: 900,000 Amount deducted each month: 6,000 Expected rate of return on investment: 10% I tried to use NPER = (.10/12, -6000, 900000) but get an error. If I make both signs negative, I get 111, which I know the answer should be bigger. Thoughts? |
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