Mr Lim and his wife are earning a gross monthly salary of $6,000 and $4,000 respectively. Both of them are 35 years old and have 2 children, aged 5 and 1 currently. They want to start saving a constant sum of money next month for the children’s. They hoped that they will have enough money in 10 years’ time.
The following are the monthly education expenses for each child:
· Primary Education: $300 per month (Duration: 6 years)
· Secondary Education: $400 per month (Duration: 4 years)
· Junior College: $500 per month (Duration: 2 years)
· University (overseas): $5,000 per month (Duration: 4 years)
How much must they save per month to achieve their goal?
2. You can afford a $450.00 a month house renovation payment. At 9% interest, how much can you borrow today on a three year house renovation loan (assuming the end of month payment)?
3. Joe is doing calculation for his retirement. He wants to find out whether he had sufficient money now to meet his retirement in 10 years’ time. He expects that by retirement he should have $1,000,000. What is the minimum amount of money he should have now to meet his retirement target? Assume interest in compounded semi-annually at 5% per annum.
4. Joe can afford to pay 10% of his salary every month to repay his housing loan. How much would he have paid in 5 years’ time if interest is 10% compounded monthly? His salary is $2,000 to be paid at the end of each month.
I'm totally weak in this area..pls help me with all these problems.
I tried but nothing come out of my head.