A client, 35 years old, who would like to retire at age 65 (30 years from...

A client, 35 years old, who would like to retire at age 65 (30 years from today). Her goal is to have enough in her retirement account to provide an income of $75,000 a year, starting a year after retirement or year 31, for 25 years thereafter. She had a late start on saving for retirement, with a current balance of $10,000. To catch up, she is now committed to saving $5,000 a year, with the first contribution a year from now. A single parent with two children, both of which will be attending college starting in five years, she won't be able to increase the annual $5,000 commitment until after the kids have graduated. Once the children are finished with college, she will have extra disposable income, but is worried about just how much of an increase it will take to meet her ultimate retirement goals. To help her meet this goal, estimate how much she will need to save every year, starting 10 years from now, when the kids are out of college. Assume an average annual 8% return in the retirement account.

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jeff jeffy answered 1 year ago

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