Your best friend Samis in discussion with you about saving for his retirement.You areto advise him on how much he should deposit annually to meet his retirement needs. Assume that he will deposit a fixed annual amount for the next 20 years into a retirement savings account, starting one year from now. Sam has a son who will be attendingcollege and plans to make 5 withdrawals(starting one year after making his final deposit into the retirement account)of$35,000eachto pay for his annual tuition forthe following 5 years. Commercial Banks will be paying 6 percent on such retirement accountsfor the next 25 years. KindlyadviseSam on how much he should place in the account annually to cover his retirement needs.

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Retirement Income

Retirement income is the income received by the retiring person after retirement. Income can either be paid every month or paid annually. The retiree would get a guaranteed income until their death. Retirement income payment differs from person to person based on their investment type and payment method. Some are paid on a lump-sum basis and some are paid in a regular series with fixed payment or variable cash flow. Retirement income can be created from retirement savings, investment, salary, bonus, and wages from employment. Every working individual should plan their retirement income according to their income goals for the future. The plan should be made by identifying suitable income sources, estimating future expenses, applying a savings plan, and managing risk and assets. The most common age for retirement is between 60-65 years.