How long would $80,000 in Individual Retirement Account savings last if $1,000 were withdrawn each month? The rate of return on the IRA is 8% compounded monthly and the monthly withdrawals begin immediately.
Enter the following values in the input fields:
Present Value = 80,000
Future Value = 0
Payment/Deposit = -1,000
Periods/Year = 12
Interest Rate = 8
Set Payment/Deposit Timing for Begin since the withdrawals begin
immediately.
Now click the Periods button.
The savings would last 113.57 periods. Since this calculation has 12 periods per year, this would be about 9.5 years (113.57/12 = 9.5).
Notice the entry for payment/deposit is negative since the amount is being withdrawn from the present value.
The total interest compounded box also shows a total of $33,566.88 in interest was earned over the life of the savings. See the screen snapshot of this calculation below:
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