HP 10B - Manual (Page 114)

339,994.39
8 flTYR] 0 f^Tl f^] - 22.995.36
Stores after-tax future
value in
Calculates present-value
purchasing power of
afler-tax FK, assuming an
8 % inflation rale.
Value of a Taxable Retirement Account
This problem uses the TVM application to calculate the future value of a
taxable retirement account that receives regular, annual payments begin­
ning today (Begin mode). The annual tax on the interest is paid out of the
account. (Assume the deposits have been taxed already.)
Example.
If you invest $3,000 each year for 35 years, with dividends
taxed as ordinary income, how much will you have in the account at retire­
ment? Assume an annual dividend rate of 8.175%, a tax rate of 28%, and
that payments begin today. What is the purchasing power of that amount
in toda/s dollars, assuming 8 % infLition?
Set to Begin mode. Press BlBEGi^ENDl if BEGIN annunciator is not
displayed.
Keys: Display: Description:
1 ■(P/YRl 1.00 Sets 1 payment per year.
35 (N) 35.00 Stores number of pay­
ment periods until
retirement.
8.175 □ 28 H 0 5.89 Calculates interest rate
diminished by tax rate.
fiTYRl 5.89 Stores adjusted interest
rale.
0 0.00 Stores amount you arc
.starting with.
3000 fP^ - 3.000.00 Stores amount of annual
payment.
8: AddlUonal Examplos 111