I am working a problem and don't know how to proceed. Here's the problem: When Sam starts working at age 18 he also starts putting away $100 a month into his retirement account, which pays 10% interest compounded monthly.
A.) How much wouuld be in his account when he gets ready to retire 35 years later?
This part I understand. The part I am stuck on is next.
B.) Suppose he missed a payment in June of the second year (the 15th payment). How much would be in the account when he retired?
I am not sure how to proceed. Should I calculate the value of the account up to the 14th payment, and add to the rest? I don't want to have to do S= 100+100(1.0083)+100(1.0083)^2.... since its for 35 years (420) values.
A.) How much wouuld be in his account when he gets ready to retire 35 years later?
This part I understand. The part I am stuck on is next.
B.) Suppose he missed a payment in June of the second year (the 15th payment). How much would be in the account when he retired?
I am not sure how to proceed. Should I calculate the value of the account up to the 14th payment, and add to the rest? I don't want to have to do S= 100+100(1.0083)+100(1.0083)^2.... since its for 35 years (420) values.