Melissa made contributions to a Roth IRA over the course of 41 working years. Her contributions averaged $2,750 annually. Melissa was in the 26% tax bracket during her working years. The average annual rate of return on the account was 5.5%. Upon retirement, Melissa stopped working and making Roth IRA contributions. Instead, she started living on withdrawals from the retirement account. At this point, Melissa dropped into the 10% tax bracket. Factoring in taxes, what is the effective value of Melissa’s Roth IRA at retirement? Assume annual compounding.

Question

ganeshie8 · Answer

find the accumulated amount using annuity formula first

anonymous · Answer

I tried and keep gettin different answers. my answer choices are:

$369,762.04
$419,762.04
$381,037.04
$387,802.04



and ive got none. the closest i got to one was near D

ganeshie8 · Answer

looks like u forgot to subtract the taxes ?

anonymous · Answer

What do you mean ?

ganeshie8 · Answer

you need to subtract the taxes on Roth IRA

ganeshie8 · Answer

Factoring in taxes, what is the effective value of Melissa’s Roth IRA at retirement?

ganeshie8 · Answer

after subtracting the taxes, u should get : http://www.wolframalpha.com/input/?i=2750*%28+%28%281%2B0.055%29%5E%2841%29-1%29%2F%280.055%29+%29+-++41*.26*2750

anonymous · Answer

But that isnt an answer choice.

ganeshie8 · Answer

oh realy.... when i looked at it , it was one of the option s.... 
let me check it agian :)

ganeshie8 · Answer

it is one of ur options

anonymous · Answer

$369,762.04
$419,762.04
$381,037.04
$387,802.04

These are my answer choices

ganeshie8 · Answer

and, what do u see in the wolfram link ?

anonymous · Answer

OOOOh. im sorry, i was looking at the bottom. may you help me with one more ?ill medal you again

ganeshie8 · Answer

lol i guessed so :)

ganeshie8 · Answer

shoot...