**Exercise: Retirement Savings Calculation****Scenario:**You are paid $3,000 per month and your employer's 401(k) matches your contributions by 10% up to a maximum of 15% of your pay. Assuming you max-out your retirement savings and work for 25 years, how much will the 401(k) be worth when you retire (if you can get an APR of 8% during your work years)? If you are taxed at a rate of 27%, then how much will you have when you retire?**Instructions:**Round all answers to 2 decimal places.**Inputs:**- Before taxes retirement amount: [Enter Amount]- After taxes retirement amount: [Enter Amount]**Additional Information:**- The scenario allows you to explore the impact of different contribution levels and tax rates on your retirement savings over a set period.- Use the provided fields to input the calculated values based on the given assumptions.**Note:**This exercise is designed to help understand the growth potential of retirement savings through employer contributions and the effects of taxes.

The 401(k) retirement plan: The 401 (k) plan is a plan that encourages salary earners to save for…

ndmded Suppose you are paid $3,000 per month and your employer's 401(k) matches your contrībutions by 10% up to a maximum of 15% of your pay. Assuming you max-out your retirement savings and you work for 25 years, how much will the 401(k) be worth when you retire (if you can get an APR of 8% during your work years)? If you are taxed at a rate of 27%, then how much will you have when you retire? Round all answers to 2 decimal places. Before taxes retirement amountS Number After taxes retirement amount s Number

ndmded Suppose you are paid $3,000 per month and your employer's 401(k) matches your contrībutions by 10% up to a maximum of 15% of your pay. Assuming you max-out your retirement savings and you work for 25 years, how much will the 401(k) be worth when you retire (if you can get an APR of 8% during your work years)? If you are taxed at a rate of 27%, then how much will you have when you retire? Round all answers to 2 decimal places. Before taxes retirement amountS Number After taxes retirement amount s Number

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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Your employer offers a 401(k) plan with a 15% match, and you set a goal of retiring in 35 years with an amount of money which has the same buying power that 1.7 million dollars has today. If the account earns an annual interest rate of 1.2% and the expected annual rate of inflation is 2%, how much should YOU contribute each month to the 401(k)? Round your answer to the nearest dollar.
If John wants to retire with $10,000 per month, how much principal is necessary to generate this amount of monthly income if the interest rate is 3%?t $ Need Help? Read It
You choose to invest your $3,410 income tax refund check (rather than spend it!) in an account earning 5% compounded annually. How much will the account be worth in 30 years? (Use the Table provided.) (Round your answer to the nearest cent.)
Your employer automatically puts 5 percent of your salary into a 401(k) retirement account each year. The account earns 8% interest. Suppose you just got the job, your starting salary is $50000, and you expect to receive a 3% raise each year. For simplicity, assume that interest earned and your raises are given as nominal rates and compound continuously. Find the value of your retirement account after 35 years Value = $
If John wants to retire with $10,000 per month, how much principal is necessary to generate this amount of monthly income if the interest rate is 8%?t $ Read It Need Help?
In 2012 the maximum Social Security deposit by an individual was $8,386.75. Suppose you are 27 and make a deposit of this amount into an account at the end of each year. How much would you have (to the nearest dollar) when you retire if the account pays 2% compounded annually and you retire at age 65?_____$
f you saved your tax refund $14,089.39, quit buying vendor coffee for one year $12,522.23, and decided to contribute $5,040 (you saved $420 per month) in your Roth IRA, how much would you have for retirement if you could invest these savings at 7% compounded annually for 30 years for this one year of savings? (Use the Table 12.1 provided.) Note: Round your answer to two decimal places. Amount saved for Retirement
Please answer using life-cycle problem. Suppose the interest rate is 5%, the income tax rate 35%, the tax rate on investment income is 20%, and the investment horizon 40 years. (a) What is the final payoff after tax if $100 pre-tax income is invested in a regular savings account? (b) What is the final payoff after tax if $100 pre-tax income is invested in a retirement account? (c) What is the final payoff after tax if $100 pre-tax income is invested in a Roth account?
please show all work and state answer clearly
When you begin your new job, your employer says they will match any 401k deposits you make by 50% up to 5% of your overall salary annually. When you start your new job as a college grad, you will make $50400 per year and you decide to take full advantage of the matching by depositing 5% of your monthly salary every month. a) How much will YOU be depositing in the 401k each month from your salary? $ b) How much will YOUR EMPLOYER be depositingin the 401k each month? c) How much TOTAL will be deposited into your 401k each month? $ d) How much will you have in the account in 35 years if it pays 7.5% APR? $ e) How much total money will you put into the account after 35 years? $ f) How much total will the employer have put into the account after 35 years? $ g) How much total interest will you earn? $ h) If you choose NOT to take advantage of depositing money into the 401k because you feel you need that money to pay bills now, how much money will you be losing from your employer and interest…
In 2012 the maximum Social Security deposit by an individual was $8,386.75. Suppose you are 29 and make a deposit of this amount into an account at the end of each year. How much would you have (to the nearest dollar) when you retire if the account pays 3% compounded annually and you retire at age 65?$
If you would like to retire as a millionaire and make a uniform deposit of $15,000 annually at an interest rate of 6%, For how many years you have to work?

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