Actuarial science, Investment, Mathematical finance

In the given case, a person has decided to plan for the retirement and wants to save 2 million by the time he is 65 years old. The person wants to start saving from the present day which is his 30th birthday and has decided to continue up to the 65th birthday (including the same). The plan is to keep aside an equal amount on each of the birthday and put the same into the persons savings account. Such annual payment of fixed amount of money over a phase of time is known as annuity. The two distinct types of annuity payments are normal annuity where the periodical payments are done at the end of the period and annuity due and that of immediate annuity where the payments are made at the very commencement of the period. Since in this case, the payment is done at the beginning of the period