Question

In: Finance

Homework 2 When you retire you expect to live for another 25 years. Each month of...

Homework 2

When you retire you expect to live for another 25 years. Each month of your retirement you want to be able to withdraw $8,500 for living expenses. If you can earn 4.5% per year on your investment, how much do you need to have in your retirement account, at the time you retire, to make this happen?

Solutions

Expert Solution


Related Solutions

You plan to retire 35 years from now. You expect that you will live 25 years...
You plan to retire 35 years from now. You expect that you will live 25 years after retiring. You want to have enough money upon reaching retirement age to withdraw $180,000 from the account at the beginning of each year you expect to live, and yet still have $2,500,000 left in the account at the time of your expected death (60 years from now). You plan to accumulate the retirement fund by making equal annual deposits at the end of...
19. You are currently 43 years old and expect to retire in 25 years, and then...
19. You are currently 43 years old and expect to retire in 25 years, and then you expect to live for another 20 years after retirement. Your current labor income is about $60,000. Assuming you have no savings, how much do you need to save from this point until retirement in order to replace 75% of your current income during retirement? (Assume no increase in wage and that your rate of interest will exceed inflation by 3%) (4 pts) 20....
When you retire, your company promises to pay you $1500 a month for 25 years. What...
When you retire, your company promises to pay you $1500 a month for 25 years. What is the value of this retirement annuity to you today, assuming 3%?
You will retire in 30 years. At the beginning of each month until you retire, you...
You will retire in 30 years. At the beginning of each month until you retire, you will invest X earning interest at 9% convertible monthly. Starting at year 30, you will withdraw $4,000 at the beginning of each month for the next 15 years. Also, starting at year 30, your fund will only earn interest at 6% convertible monthly. Find X such that your account will be empty after the last withdrawal.
You are 25 years old and plan to retire 35 year from today. You expect that...
You are 25 years old and plan to retire 35 year from today. You expect that you will live 30 years after retiring. You want to have enough money upon reaching retirement age to withdraw $150,000 from the account at the beginning of each year you expect to live, and yet still have $1,000,000 left in the account at the time of your expected death (65 years from now). You plan to accumulate the retirement fund by making equal annual...
You are 25 years old and plan to retire 35 year from today. You expect that...
You are 25 years old and plan to retire 35 year from today. You expect that you will live 30 years after retiring. You want to have enough money upon reaching retirement age to withdraw $150,000 from the account at the beginning of each year you expect to live, and yet still have $1,000,000 left in the account at the time of your expected death (65 years from now). You plan to accumulate the retirement fund by making equal annual...
Assume that you are 30 years old and expect to retire when you reach 65. If...
Assume that you are 30 years old and expect to retire when you reach 65. If you were to retire today, you would like a fixed (pretax) income of 60,000 per year (in addition to the social security) for a period of 15 years ( your approximate life expectancy at age 65). However you realized that price inflation will erode the purchasing power of the dollar over the next 35 years and you want to adjust your desired retirement income...
Assume that you are 30 years old today and expect to retire when you reach age...
Assume that you are 30 years old today and expect to retire when you reach age 65. If you were to retire today, you would like a fixed (pretax) income of $60,000 per year (in addition to Social Security) for a period of 15 years (your approximate life expectancy at age 65). However, you realize that price inflation will erode the purchasing power of the dollar over the next 35 years and you want to adjust your desired retirement income...
Assume you are now 25 years old. You plan to retire when you are 65 years...
Assume you are now 25 years old. You plan to retire when you are 65 years old. You think you will live until you are 80 years. a.) If the rate of return during your working years (a.k.a. the "savings period") is 8% and you plan to save $2,000 per year, how much will you have saved up by retirement age? b.) If the rate of return during your retirement is 6% on the amount of savings you have accumulated,...
You want to have $1,000,000 when you retire in 30 years. You expect to earn 12%...
You want to have $1,000,000 when you retire in 30 years. You expect to earn 12% compounded monthly over the entire 30-year period. How much extra money per month must you deposit if you choose to fund using an ordinary annuity technique rather than an annuity due technique?
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT