Present and future value tables of $1 at 3% are presented below:

-Debbie has $368,882 accumulated in a 401K plan. The fund is earning a low, but safe, 3% per year. The withdrawals will take place annually starting today. How soon will the fund be exhausted if Debbie withdraws $30,000 each year?
A) 15 years.
B) 16 years.
C) 14 years.
D) 12.3 years.

Question

Present and future value tables of $1 at 3% are presented below:

-Debbie has $368,882 accumulated in a 401K plan. The fund is earning a low, but safe, 3% per year. The withdrawals will take place annually starting today. How soon will the fund be exhausted if Debbie withdraws $30,000 each year?
A) 15 years. 
B) 16 years. 
C) 14 years. 
D) 12.3 years.

Quizplus · Accepted Answer

$368,882 ÷ $30,000 = 12.29607
For PVAD of $1 factor of 12.29607 and i of 3%, n = 15

Present and Future Value Tables of $1 at 3% Are