Question

If your daughter wants to earn $215,000 within the next twenty-three years and the salaries grow at 4.45% per year. What salary should she start to reach her goal?

Answer 1

If S is the starting salary S(1.0445)²³≥215000. Take logs:

logS+23log1.0445≥log215000, logS≥4.8975, S≥$78985 approx.

Or S≥215000/1.0445²³=215000/2.722=$78985.