Question 277.5 ptsDeshawn, who turned 21 years old today, is planning for retirement. Deshawn is just starting his firstfull time job and has nothing set aside in his retirement account. He plans to add an equal amount inreal terms at the end of each of the next 46 years so that he can retire at age 67. His goal is to builda retirement account that will enable him to make 30 annual withdraws with a purchasing power of$60,000 (at today's prices) on his 68th through 97th birthdays. His retirement account is expectedto earn 7.00% per year and the expected inflation rate is 2.00% per year. How much does Deshawnneed to set aside in real terms at the end of each of the next 46 years to meet his retirement goal?Round your answer to the nearest penny. For example, $2,371.243 should be entered as 2371.24

Answered: Image /qna-images/answer/2d3731b3-dd8f-496f-9ab0-620d92b2b488.jpg

Answered: to earn 7.00% per year and the expected…

to earn 7.00% per year and the expected inflation rate is 2.00% per year. How much does Deshawn need to set aside in real terms at the end of each of the next 46 years to meet his retirement goal?

PFIN (with PFIN Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)

6th Edition

ISBN:9781337117005

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter14: Planning For Retirement

Section: Chapter Questions

Problem 2FPE

See similar textbooks

Similar questions

NO2.5 Daryl wishes to save money to provide for his retirement. He is now 30 years old and will be retiring at age 64. Beginning one month from now, he will begin depositing a fixed amount into a retirement savings account that will earn 12% compounded monthly. Then one year after making his final deposit, he will withdraw $100,000 annually for 25 years. In addition, and after he passes away (assuming he lives 25 years after retirement) he wishes to leave in the fund a sum worth $1,000,000 to his nephew who is under his charge. The fund will continue to earn 12% compounded monthly. How much should the monthly deposits be for his retirement plan?
#16 Today is Derek's 25th birthday. Derek has been advised that he needs to have $2,993,861.00 in his retirement account the day he turns 65. He estimates his retirement account will pay 7.00% interest. Assume he chooses not to deposit anything today. Rather he chooses to make annual deposits into the retirement account starting on his 29.00th birthday and ending on his 65th birthday. How much must those deposits be? Submit Answer format: Currency: Round to: 2 decimal places. unanswered not_submitted Attempts Remaining: Infinity
Question 6 John Adams plans to retire at the age of 62. He wants an annual income of $60,000 per year. He believes that he will live to be 87. He will draw the money at the beginning of each year. How much money will he need when he retires in order to support his $60,000 annual life style if he will average 12 percent per year on his retirement account? a. $527,059 b. $470,586 c. $439,800 d. $505,302
Question 2You plan to retire 33 years from now. You expect that you will live 27 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 each year for the next 33 years. You expect that you will be able to earn 12% per year on your deposits. However, you only expect to earn 6% per year on your investment after you retire since you will choose to place the money in less risky investments.Required:Calculate the equal annual deposits you must make each year to reach your retirement goal.
What does Shelley need to save monthly to make sure she is on track to reach her retirement goal of having $440,000 saved by the time she reaches age 65? She is 48 years old, has been contributing $400 per month and has $180,000 in her RRSP. Assume she will make an annual return of seven percent. Question 12Select one: a. $1275 b. $336 c. $681 d. $1133
•Edith plans to retire in 25 years, and she wants to withdraw $200,000 per year for 35 years. Her account earns 6 percent compounded annually. How much must she save each year to meet her retirement objective? answer is 52,851.09 if possible , please use BAII plus calculator
mni.3
Jim Hunter has decided to retire to Florida in 10 years. What amount should Jim invest today so that he'll be able to withdraw $25,000 at the end of each year for 30 years after he retires? Assume he can invest money at 9% interest compounded annually. A. $18,790.27 B. $105,470.27 C. $10,480.27 D. $108,490.27
Solve only question number 7
Aplesh
# 13 → A couple is saving for retirement with three different accounts. The table below shows the current balances in their accounts, along with their yearly contribution, and the yearly return on each account. The couple will retire in 24.00 years and pool the money into a savings account that pays 4.00% APR. They plan on living for 29.00 more years and making their yearly withdrawals at the beginning of the year. What will be their yearly withdrawal? Yearly Contribution Account Fidelity Mutual Fund Vanguard Mutual Fund Employer 401k Balance $24,047.00 $195,517.00 $313,848.00 Submit Answer format: Currency: Round to: 2 decimal places. $1,000.00 $10,000.00 $15,000.00 APR 7.00% 7.00% 5.00%
Problem Outline Part A By the end of this year, you will be 35-years old, and you want to plan for your retirement. You wish to retire at the age of 65, and you expect to live 20 years after retirement. Upon retirement you wish to have an annual sum of $50,000 to supplement your social security benefits. Therefore, you opened your retirement account with a 7% annual interest rate. At retirement you liquidate your account and use the funds to buy an investment grade bond which makes $50,000 annual coupon payments based on a 6 % coupon rate throughout your retirement years. What is the face value, not the actual value, of the bond that you will be investing in? Calculate the monthly payment in your retirement account to be able to achieve the plan mentioned above. How much will your inheritors receive? Problem Outline Part B Suppose you think if you were to retire right now, you would have needed $50,000 each year to supplement your social security and maintain your desired…