Question

Assume that your brother is now 50 years old, that he plans to retire in 10 years, and that he expects to live for 25 years after he retires (i.e. until he is 85 years old). He wants a fixed retirement income that has the same purchasing power at the time he retires as $50,000 has today (he realizes that the real value of his retirement income will decline year by year after he retires). His retirement income will begin pm the day he retires, 10 years from today, and he will then get 24 additional annual payments. Inflation is expected to be 3% per year from today forward. Your brother currently has a savings of $275,000 and expects to earn a return on his savings of 8% per year, annual compounding.

**PLEASE SHOW EXCEL FORMULAS/FUNCTIONS**

To the nearest dollar, how much must your brother save during each of the next 10 years (with deposits being made at the end of each year) in order to meet his retirement goal?

Answer #1

Assume that your father is now 50 years old, plans to retire in
10 years, and expects to live for 25 years after he retires - that
is, until age 85. He wants his first retirement payment to have the
same purchasing power at the time he retires as $40,000 has today.
He wants all his subsequent retirement payments to be equal to his
first retirement payment. (Do not let the retirement payments grow
with inflation: Your father realizes that...

Required Annuity Payments
Assume that your father is now 50 years old, plans to retire in
10 years, and expects to live for 25 years after he retires - that
is, until age 85. He wants his first retirement payment to have the
same purchasing power at the time he retires as $40,000 has today.
He wants all of his subsequent retirement payments to be equal to
his first retirement payment. (Do not let the retirement payments
grow with inflation:...

Your father is 50 years old and will retire in 10 years. He
expects to live for 25 years after he retires, until he is 85. He
wants a fixed retirement income that has the same purchasing power
at the time he retires as $60,000 has today. (The real value of his
retirement income will decline annually after he retires.) His
retirement income will begin the day he retires, 10 years from
today, at which time he will receive 24...

Your father is 50 years old and will retire in 10 years. He
expects to live for 25 years after he retires, until he is 85. He
wants a fixed retirement income that has the same purchasing power
at the time he retires as $40,000 has today. (The real value of his
retirement income will decline annually after he retires.) His
retirement income will begin the day he retires, 10 years from
today, at which time he will receive 24...

Your father is 50 years old and will retire in 10 years. He
expects to live for 25 years after he retires, until he is 85. He
wants a fixed retirement income that has the same purchasing power
at the time he retires as $40,000 has today. (The real value of his
retirement income will decline annually after he retires.) His
retirement income will begin the day he retires, 10 years from
today, at which time he will receive 24...

Your father is 50 years old and will retire in 10 years. He
expects to live for 25 years after he retires, until he is 85. He
wants a fixed retirement income that has the same purchasing power
at the time he retires as $45,000 has today. (The real value of his
retirement income will decline annually after he retires.) His
retirement income will begin the day he retires, 10 years
from today, at which time he will receive 24...

Your father is 50 years old and will retire in 10 years. He
expects to live for 25 years after he retires, until he is 85. He
wants a fixed retirement income that has the same purchasing power
at the time he retires as $55,000 has today. (The real value of his
retirement income will decline annually after he retires.) His
retirement income will begin the day he retires, 10 years
from today, at which time he will receive 24...

Your father is 50 years old and will retire in 10 years. He
expects to live for 25 years after he retires, until he is 85. He
wants a fixed retirement income that has the same purchasing power
at the time he retires as $50,000 has today. (The real value of his
retirement income will decline annually after he retires.) His
retirement income will begin the day he retires, 10 years from
today, at which time he will receive 24...

Your father is 50 years old and will retire in 10 years. He
expects to live for 25 years after he retires, until he is 85. He
wants a fixed retirement income that has the same purchasing power
at the time he retires as $60,000 has today. (The real value of his
retirement income will decline annually after he retires.) His
retirement income will begin the day he retires, 10 years from
today, at which time he will receive 24...

Your father is 50 years old and will retire in 10 years. He
expects to live for 25 years after he retires, until he is 85. He
wants a fixed retirement income that has the same purchasing power
at the time he retires as $55,000 has today. (The real value of his
retirement income will decline annually after he retires.) His
retirement income will begin the day he retires, 10 years
from today, at which time he will receive 24...

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