Neha would retire 30 years from today and she would need Rs 6,00,000 per year after her retirement, with the first retirement funds withdrawn one year from the day she retires. Assume a return of 7% per annum on her retirement funds and if her planning is for 25 years after retirement,
Calculate:
a. How much lumpsum she should deposit in her account today so that she has enough funds for retirement?
b. How much she should deposit each year so that she has enough funds for retirement?
If you invest 20,00,000 lump sum, you will get 1,52,24,510₹ Lump sum, which is equal to 6 lakhs annual amount required for 25 years. I could not find right logical formula. If you find PV of FV lump sum 1,50,00,000₹, it’s 1,970,507.00₹ Lump sum.
Formula=
pv of FV lump sum= 1,50,00,000/(1.07)^30
I think, you need to pay 1.6 lakhs annuities to get close to that amount when the payment is constant.
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