Number of Periods to Deplete a Savings Account or to Reach a Specified Balance.
Given the current value of a savings account, the periodic interest rate, the amount of the periodic withdrawal, and a specified balance, this procedure determines the number of periods to reach that balance (the balance is zero if the account is depleted).
1.Press 
and press 
CLEAR 
.
2.Key in the value of the savings account and press 
.
3.Key in the periodic interest rate and press 
.
4.Key in the amount of the periodic withdrawal and press 
.
5.Key in the amount remaining in the account and press 
. This step may be omitted if the account is depleted (FV=0).
6.Press 
to determine the number of periods to reach the specified balance.
Example: Your savings account presently contains $18,000 and earns 5 1/4% compounded monthly. You wish to withdraw $300 a month until the account is depleted. How long will this take? If you wish to reduce the account to $5,000, how many withdrawals can you make?
Keystrokes Display
CLEAR 
18000 | 71.00 | Months to deplete account. |
|
|
5.25
300 
5000 | 53.00 | Months to reduce the account to | |
$5,000 | |||
|
Periodic Deposits and Withdrawals
This section is presented as a guideline for evaluating a savings plan when deposits and withdrawals occur at irregular intervals. One problem is given, and a step by step method for setting up and solving the problem is presented:
Example: You are presently depositing $50 and the end of each month into a local savings and loan, earning 5 1/2% compounded monthly. Your current balance is $1023.25. How much will you have accumulated in 5 months?
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