Question

sandra is planning for her retirement. She is 35 years old and expects to retire in 40 years from now. She expects to live for another 25 years after retirement. Her current anneal expenditures are 54,000 and she expects them to increase at a rate of 3%per year, the rate of inflation, until she retires

Upon retiring, her expenditures will be equal to her consumption expenditure at 75. Sandra belives that she can accumulate 2m$ by the time she retires. What would be the amount of money be enough to cover her consumption expenditures during her retirement years ?

Note : After consulting with some expert, in the field, sandra anticipating interest rate to be (5.75,1) during the retirement year

Answer 1