Mrs. Miller is planning for her retirement, so she is setting up a payout annuity with her bank. She wishes to receive a payout of $1875 per month for 20 years. How much money must she deposit if her money earns 8% interest compounded monthly?
Based upon your question Ms. Miller would need a present value of $225,658 in order to draw $1,875 for 240 periods [i.e. 20 years] at 8% interest compounded monthly