50.1K

Verified Solution

Link Copied!

Please Use Excel Functions to solve for questions a-g, please show equations/excel functions used to solve..

When you start your first job after graduating from ohia State on January 1st, 2023, you saved a portion of your salary in your company's 401k savings plan. Your salary is $60,000 annually, of which you put 10k in the savings plan at the end of each year. (In reality, a portion is saved from each paycheck, but we will use annual deposits for simplicity.) Assume the savings plan earns 5% interest annually. Your company provides matching contributions to the savings plan on the first 5% of compensation that you contribute to the savings plan. For example, if you contribute 2% of your salary, your company will match that cred deposit an amount equal to 2% of your salary, too. A total of 4% of your salary is deposited into the savings plan. Another excipie, if you CUVILTICULE 10% of your sulary, your curpuriy will only ruichote first 5% circuled urni slepusil Chourit vul to 5% of your salury. A total of 39% of your salary is d uired into the sous plan a) what is the amount of each deposit "A" (A your contribution your employer's)? b) What is the total amount of money that is in your savings plan account after five years? c) Calculate the total amount of cash, excluding Interest, that was actually taken out of your paycheck over the course of the five years hint: this doesn't include the companies money). Consider the following three scenarios (in parts d, e, f and g) independently of each other: d) Scenario 1: For some reason, you stap contributing to your company's savings plan after the deposits above, so the current amount in your savings plan (part b) carns interest without any additional contributions. What amount would be in your savings account at the end of 20507 .) Scenaria 2: Let's say, you and your company contribute the same amount part a) every year for the next 20 years, anding Dec 31st, 2043. Now, how much would be in your savings account in 2050? f) Scenario 3: While you are making deposits into your 401k, you are also buying a $3,000 a year vacation on your Citi Double Cash Credit Card and NOT paying it off. The APR on your card is 25.74% (very real). You buy 6 Vacations from 2023-2029. If you cashed your 401k in 2029, how much money do you have if you decide to pay off your credit card debt? &l Scenario 4: Consider your friend, who is cmplayed by the same company, docs not utilize the 401k savings plan. Instead, she puts her leftover income of $2,000 per year af into a savings account that carns 3% annual interest. After only 4 years, how much money has your friend missed out on if she had saved 5% of her salary per year with the 401k match? Assume your friend's salary is also $60,000 and would have saved 5% of her salary annually into the 401k match program. When you start your first job after graduating from ohia State on January 1st, 2023, you saved a portion of your salary in your company's 401k savings plan. Your salary is $60,000 annually, of which you put 10k in the savings plan at the end of each year. (In reality, a portion is saved from each paycheck, but we will use annual deposits for simplicity.) Assume the savings plan earns 5% interest annually. Your company provides matching contributions to the savings plan on the first 5% of compensation that you contribute to the savings plan. For example, if you contribute 2% of your salary, your company will match that cred deposit an amount equal to 2% of your salary, too. A total of 4% of your salary is deposited into the savings plan. Another excipie, if you CUVILTICULE 10% of your sulary, your curpuriy will only ruichote first 5% circuled urni slepusil Chourit vul to 5% of your salury. A total of 39% of your salary is d uired into the sous plan a) what is the amount of each deposit "A" (A your contribution your employer's)? b) What is the total amount of money that is in your savings plan account after five years? c) Calculate the total amount of cash, excluding Interest, that was actually taken out of your paycheck over the course of the five years hint: this doesn't include the companies money). Consider the following three scenarios (in parts d, e, f and g) independently of each other: d) Scenario 1: For some reason, you stap contributing to your company's savings plan after the deposits above, so the current amount in your savings plan (part b) carns interest without any additional contributions. What amount would be in your savings account at the end of 20507 .) Scenaria 2: Let's say, you and your company contribute the same amount part a) every year for the next 20 years, anding Dec 31st, 2043. Now, how much would be in your savings account in 2050? f) Scenario 3: While you are making deposits into your 401k, you are also buying a $3,000 a year vacation on your Citi Double Cash Credit Card and NOT paying it off. The APR on your card is 25.74% (very real). You buy 6 Vacations from 2023-2029. If you cashed your 401k in 2029, how much money do you have if you decide to pay off your credit card debt? &l Scenario 4: Consider your friend, who is cmplayed by the same company, docs not utilize the 401k savings plan. Instead, she puts her leftover income of $2,000 per year af into a savings account that carns 3% annual interest. After only 4 years, how much money has your friend missed out on if she had saved 5% of her salary per year with the 401k match? Assume your friend's salary is also $60,000 and would have saved 5% of her salary annually into the 401k match program

Answer & Explanation Solved by verified expert

See Answer