The recommended level of retirement savings an individual should have saved at each age is as follows:a. At age 30: 1X income at age 30b. At age 40: 3X income at age 40c. At age 50: 5X income at age 50d. At age 70: 7X income at age 70Required:Bob makes $90,000 a year in income at age 50, and his salary is growing at 5 percent per year. He currently has retirement savings of$400,000. He wants to know if he will have enough income to retire at age 70. Bob could ask the below questions regarding hisretirement savings and for each of these questions, determine which type of analytics might address it.QuestionHow much retirement savings did we have at age 30? Age 40?How do we adjust our savings pattern to meet the expected retirement savings target?What is the forecasted level of income at age 70?Given the expectations given of retirement income at ages 30, 40, 50, and 70, how much does the savings to date differfrom that expected?What is the forecasted retirement savings?What was the level of income at age 30, 40, and 50?When will be able to retire? Age 65? Age 70?Analytics

Descriptive analysis deals with historical data and describing past events.Diagnostic analysis seeks…

Answered: Required: Bob makes $90,000 a year in…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Sarah Wiggum would like to make a single investment and have $1.7 million at the time of her retirement in 40 years. She has found a mutual fund that will earn 6 percent annually. How much will Sarah have to invest today? If Sarah invests that amount and could earn a 13 percent annual return, how soon could she retire, assuming she is still going to retire when she has $1.7 million? To have $1.7 million at retirement, the amount Sarah must invest today is $_________(Round to the nearest cent.) see attachment for PVIF table
Brad is working with a financial planner and is confident that he can invest in mutual funds that will average 10% annual returns. If he wants to retire after 40 years with $2 million in his retirement account, how much does Brad need to deposit at the end of each of the 40 years?
bed What's the interest rate of a 5-year, annual $5,400 annuity with present value of $22,000? (Use a time value of money calculator or a spreadsheet. Round your answer to 2 decimal places.) Annuity interest rate %
Lindsay is 29 years old and has a new job in web development. She wants to make sure that she is financially sound by the age of 55, so she plans to invest the same amount into a retirement account at the end of every year for the next 26 years. (a) Construct a data table in Excel that will show Lindsay the balance of her retirement account for various levels of annual investment and return. If Lindsay invests $10,000 at return of 6%, what would be the balance at the end of the 26th year? Note that because Lindsay invests at the end of the year, there is no interest earned on the contribution for the year in which she contributes. Round your answer to a whole dollar amount. $ 10,000
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I am 40 years old. If you are going to retire at 65, post-retirement living expenses are $20,000 annual, an average annual market return of 6%, life expectancy of 90. How much do you need to save for your retirement? (Please use the TVM calculation to solve for this question, and your answers would be different because your age varies.)
You just received $225,000 from an insurance settlement. You have decided to set this money aside and invest it for your retirement. Currently, your goal is to retire 25 years from today. How much more will you have in your account on the day you retire if you can earn an average return of 10.5 percent rather than just 8 percent?
Jackie wants to retire with $ 2.1 million in savings by the time she turns 64. She is currently 23 years old. How much will she need to save each year, assuming she can get a 10% annual return on her investments? (show all inputs in your answer Training )M = N = I = PV = PMT = FV =
Molly Lincoln, a 25-year-old personal loan officer at First National Bank, understands the importance of starting early when it comes to saving for retirement. She has committed $3,500 per year for her retirement fund and assumes that she'll retire at age 65. How much will Molly have accumulated when she turns 65 if she invests in equities and earns 8 percent on average? Round your answer to the nearest dollar. Molly is urging her friend, Isaac Stein, to start his plan right away, too, because he's 45. What would his nest egg amount to if he invested in the same manner as Molly and he, too, retires at age 65? Round your answer to the nearest dollar. 2a. Nest egg at 4% 2b. Nest egg at 8%
Sarah Wiggum would like to make a single investment and have $1.2 million at the time of her retirement in 30 years. She has found a mutual fund that will earn 4 percent annually. How much will Sarah have to invest today? If Sarah invests that amount and could earn a 14 percent annual return, how soon could she retire, assuming she is still going to retire when she has $1.2 million? Click on the table icon to view the PVIF table To have $1.2 million at retirement, the amount Sarah must invest today is $ (Round to the nearest cent.)
A young engineer wants to retire at 60. They want to have $50,000 a year to augment social security. They want this to last 20 years. If they invest their money starting at age 20 at 4% annual interest, how much must they save per month to accomplish their retirement goal?
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