Help please!

[lostwithmath]

I cannot figure out how to plug my information into the Present Value Formula, p = A/(1+r/n) ^ nt. The information I have is 4.4% interest rate. Compounded Yearly. I want to be able to have 200,000 dollars for retirement in 43 years.

another formula is Compound Interest Formula A = p(1+r/n) ^ nt.

Everytime I plug the information I end up with different numbers that don't make any sense. What I m trying to figure out is how much I will need to invest in this CD(4.4% interest rate) to be able to have
200, 000.000 in 43 years.

 

[Denis]

f = future value (200,000)
p = present value (?)
i = periodic interest rate (.044)
n = number of periods (43)

standard formula: f = p(1 + i)^n
we want p:
p = f / (1 + i)^n
p = 200000 / (1.044)^43 = 31398.47~

 

[TchrWill]

You could reduce your up front deposit by making annual deposits.
The annual deposit, D, required to accululate a fund of Fn dollars in n years, with deposits starting at the end of the first year, and bearing i% interest, comounded annually derives from

D = Fn[i/[(1+i)^n - 1]

Thus, D = 200,000[.044/[(1.044)^43 -1] = $1638.31.

If you would prefer to make monthly deposits with interest compounded monthly, your monthly depodsits would be $130.72

 

[Denis]

If you would prefer to make monthly deposits with interest compounded monthly, your monthly depodsits would be $130.72

Hmmm...you sure, TW?
Wouldn't you need to reduce the 4.4% to it's "equivalent if compounded monthly"?
I make it 4.314~% compounded monthly; monthly deposit = 133.87~