1 Required annuity payments 2 3 4 Years to retirement 5 Years of retirement Inflation rate 6 7 Savings 8 Rate of return 9 10 Calculate value of savings in 10 year 11 Savings at t= 10 12 Retirement income today 17 18 Calculate value of fixed retirement income in 10 13 years: 14 Retirement income at t = 10 15 16 $55,000 10 25 19 Calculate net amount needed at t= 10: 20 Value of retirement payments 21 Value of savings 22 3.00% $205,000 7.00% Calculate value of 25 beginning-of-year retirement payments at t=10: Retirement payments at t = 10 Net amount needed 23 24 Calculate annual savings needed for next 10 years: 25 Annual savings needed for retirement Formulas #N/A #N/A #N/A #N/A #N/A #N/A #N/A
1 Required annuity payments 2 3 4 Years to retirement 5 Years of retirement Inflation rate 6 7 Savings 8 Rate of return 9 10 Calculate value of savings in 10 year 11 Savings at t= 10 12 Retirement income today 17 18 Calculate value of fixed retirement income in 10 13 years: 14 Retirement income at t = 10 15 16 $55,000 10 25 19 Calculate net amount needed at t= 10: 20 Value of retirement payments 21 Value of savings 22 3.00% $205,000 7.00% Calculate value of 25 beginning-of-year retirement payments at t=10: Retirement payments at t = 10 Net amount needed 23 24 Calculate annual savings needed for next 10 years: 25 Annual savings needed for retirement Formulas #N/A #N/A #N/A #N/A #N/A #N/A #N/A
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
Transcribed Image Text:A
1 Required annuity payments
2
3 Retirement income today
4 Years to retirement
5
Years of retirement
6
Inflation rate
7 Savings
8
9
10 Calculate value of savings in 10 year
11 Savings at t = 10
12
Calculate value of fixed retirement income in 10
13
years:
14 Retirement income at t = 10
15
16
17 Retirement payments at t = 10
18
19 Calculate net amount needed at t = 10:
20 Value of retirement payments
21
Value of savings
22
23
24 Calculate annual savings needed for next 10 years:
25 Annual savings needed for retirement
26
Rate of return
B
Net amount needed
$55,000
10
25
3.00%
$205,000
7.00%
Calculate value of 25 beginning-of-year retirement
payments at t = 10:
C
D
Formulas
#N/A
#N/A
#N/A
#N/A
#N/A
#N/A
#N/A
E
F
G
H
K
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