Kirby is 59 years of age. He is planning for future long-term care needs. He knows that yearly nursing home costs in his area are currently $80,000, with prices increasing by 7 percent annually. Kirby also is willing to assume a five year LTC need. How much does Kirby need on his first day of care to fully fund LTC costs if he goes into a nursing care facility at age 80 ? Assume that he can earn 9 percent on savings ( before taxes) and that he is in a 20 percent combined state and federal marginal income tax bracket.

Kirby is 59 years of age. He is planning for future long-term care needs. He knows that yearly nursing home costs in his area are currently $80,000, with prices increasing by 7 percent annually. Kirby also is willing to assume a five year LTC need. How much does Kirby need on his first day of care to fully fund LTC costs if he goes into a nursing care facility at age 80 ? Assume that he can earn 9 percent on savings ( before taxes) and that he is in a 20 percent combined state and federal marginal income tax bracket.

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

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