I’m studying for my Accounting class and need an explanation.
Assume you are 25 and earn $35,000 per year, never expect to receive a raise, and plan to retire at age 55. If you invest 5 percent of your salary in a 401(k) plan returning 10 percent annually, and the company provides a $0.50 per $1.00 match on your contributions up to 3% of your salary, (1) what is the estimated future value of your 401(k) account? (4 points)
(2) Once you retire, how much can you withdraw monthly if you want to deplete your account over 30 years? (6 points)