1. Savings & Loans Check answers to the HW.

2. Savings for Drew The Carters plan to send the two boys to Drew, their college alma mater, so they have started saving some money. They invest $100 dollars monthly for each in a college fund account that has an average annual interest of 8% and is applied monthly when the payments are made. a)How much money will they have for Drew for Dylan if he applies to college in 10 years? b)How much money will they have for Drew for Sam if he applies to college in 13 years?

3. How much should the Carters save for Dylan and Sam each month if they want to have at least $100,00 saved by the time they go to college? The college account will still average 8% APR. a) Dylan b) Sam

4. The Halldorsons’ Retirement Mr. and Mrs. Halldorson are planning their retirement (who cares about college costs). They plan to retire to a sunny island in the Caribbean in 21 years. Mr. H saves $200 a month in an annuity that earns about 7% annually. a)How much will they have to live on if he retires in 21 years? b)If the Mrs. would like at least $500,000 in the bank when they retire, how much should he deposit in the annuity each month?

5. Ms. Meister’s Car If the VW Eos costs $32,000 and Ms. Meister got a loan for 5 years at 4%, how much are her monthly payments? When she pays off the car, how much has she paid total for the car?

6. First a car, next a house. Ms. Meister is buying a house and needs to get a mortgage. The cost of the house is $250,000 and she must make a 20% down payment. The mortgage is the loan for the remainder of the cost of the house. a) If she gets a mortgage at 4.5% (very low) for 30 years, what will her monthly payments be? b) When she pays off the house how much has she paid total?