Robert wants to start an IRA that will have $550,000 in it when he retires in 25 years. How much should he invest quarterly in his IRA to do this if the interest is 6% compounded quarterly? Assume an Annuity Due. Round to the nearest cent.

There are 25 × 4 = 100 quarterly deposits, and the interest rate per quarter is 6% ÷ 4 = 1.5%. For an annuity due, the future value factor is ((1.015^100 − 1) ÷ 0.015) × 1.015, which is about 232.2351. Dividing $550,000 by that factor gives a quarterly investment of about $2,368.29, so the correct choice is $2,368.29.

AI-written and checked against the verified answer.