Compute the future value using the savings and graduation gift.
Jay Coleman just graduated. He plans to work for 5 years and then leave for the Australian country. He figures that he can save $3,500 a year for the first 3 years and $5,000 a year for the next 2 years. These savings will start one year from now. In addition, his family just gave him a $2,500 graduation gift. If he puts the gift, and the future savings when they start, into an account that pays 8% compounded annually, what will his financial be when he leaves for Australia 5 years from now?