A colledge student who is currently at the age of 20 in year 2017. This student
ID: 2570099 • Letter: A
Question
A colledge student who is currently at the age of 20 in year 2017. This student plans to enter the workforce at the age of 25. The starting salary when this student starts working is expected to be $50000. The expected annual salary raise is 5%. This student plans to retire at the age 60 and lives to the age of 100. After retirement, this student expects to keep a life style at the level of the same purchasing power as having an annual revenue of $80000 in 2017 dollars. The student plans to contribute a constant percentage of country is expected to be at 3%, how much should be the constant percentage this student contribute each year to the retirement fund? Please fill out the value without the percentage sign and round the percentage value to the nearest integer 1. The contribution will only be made during the years that the student is in the workforce, i.e., start working but before the retirement Note 2. After the retirement, starting from the year when the student is 61 years old, his/her only revenue source will be from the retirement fund 3. When the student reaches the expected life span, the retirement fund will be exhausted his/her salary into a retirement fund which is expected to earn 10% annual return. If the average inflation in thisExplanation / Answer
B C D E F G H I K L=G+H+I-K Year Inflation Withdraw /pension Salary Contribution opening balance of Fund Annual Contribution Interest Withdraw Closing balance of fund 2017 1.00 0 2018 1.03 0 2019 1.06 0 2020 1.09 0 2021 1.13 0 2022 1.16 50,000.00 0.14183934 - 7091.97 - - 7091.97 2023 1.19 52,500.00 0.14183934 7,091.97 7446.57 709.2 0 15247.73 2024 1.23 55,125.00 0.14183934 15,247.73 7818.89 1524.8 24591.40 2025 1.27 57,881.25 0.14183934 24,591.40 8209.84 2459.1 35260.37 2026 1.30 60,775.31 0.14183934 35,260.37 8620.33 3526.0 47406.74 2027 1.34 63,814.08 0.14183934 47,406.74 9051.35 4740.7 61198.76 2028 1.38 67,004.78 0.14183934 61,198.76 9503.91 6119.9 76822.55 2029 1.43 70,355.02 0.14183934 76,822.55 9979.11 7682.3 94483.92 2030 1.47 73,872.77 0.14183934 94,483.92 10478.07 9448.4 114410.37 2031 1.51 77,566.41 0.14183934 114,410.37 11001.97 11441.0 136853.38 2032 1.56 81,444.73 0.14183934 136,853.38 11552.07 13685.3 162090.78 2033 1.60 85,516.97 0.14183934 162,090.78 12129.67 16209.1 190429.53 2034 1.65 89,792.82 0.14183934 190,429.53 12736.15 19043.0 222208.64 2035 1.70 94,282.46 0.14183934 222,208.64 13372.96 22220.9 257802.47 2036 1.75 98,996.58 0.14183934 257,802.47 14041.61 25780.2 297624.32 2037 1.81 103,946.41 0.14183934 297,624.32 14743.69 29762.4 342130.44 2038 1.86 109,143.73 0.14183934 342,130.44 15480.87 34213.0 391824.36 2039 1.92 114,600.92 0.14183934 391,824.36 16254.92 39182.4 447261.72 2040 1.97 120,330.96 0.14183934 447,261.72 17067.66 44726.2 509055.55 2041 2.03 126,347.51 0.14183934 509,055.55 17921.05 50905.6 577882.16 2042 2.09 132,664.89 0.14183934 577,882.16 18817.10 57788.2 654487.47 2043 2.16 139,298.13 0.14183934 654,487.47 19757.95 65448.7 739694.17 2044 2.22 146,263.04 0.14183934 739,694.17 20745.85 73969.4 834409.44 2045 2.29 153,576.19 0.14183934 834,409.44 21783.15 83440.9 939633.53 2046 2.36 161,255.00 0.14183934 939,633.53 22872.30 93963.4 1056469.19 2047 2.43 169,317.75 0.14183934 1,056,469.19 24015.92 105646.9 1186132.03 2048 2.50 177,783.63 0.14183934 1,186,132.03 25216.71 118613.2 1329961.94 2049 2.58 186,672.82 0.14183934 1,329,961.94 26477.55 132996.2 1489435.69 2050 2.65 196,006.46 0.14183934 1,489,435.69 27801.43 148943.6 1666180.68 2051 2.73 205,806.78 0.14183934 1,666,180.68 29191.50 166618.1 1861990.25 2052 2.81 216,097.12 0.14183934 1,861,990.25 30651.07 186199.0 2078840.34 2053 2.90 226,901.97 0.14183934 2,078,840.34 32183.63 207884.0 2318908.01 2054 2.99 238,247.07 0.14183934 2,318,908.01 33792.81 231890.8 2584591.61 2055 3.07 250,159.43 0.14183934 2,584,591.61 35482.45 258459.2 2878533.22 2056 3.17 262,667.40 0.14183934 2,878,533.22 37256.57 287853.3 3203643.12 2057 3.26 275,800.77 0.14183934 3,203,643.12 39119.40 320364.3 3563126.83 2058 3.36 80000 268,791.91 3,563,126.83 0.00 356312.7 268,791.91 3650647.59 2059 3.46 80000 276,855.67 3,650,647.59 0.00 365064.8 276,855.67 3738856.68 2060 3.56 80000 285,161.34 3,738,856.68 0.00 373885.7 285,161.34 3827581.01 2061 3.67 80000 293,716.18 3,827,581.01 0.00 382758.1 293,716.18 3916622.93 2062 3.78 80000 302,527.67 3,916,622.93 0.00 391662.3 302,527.67 4005757.55 2063 3.90 80000 311,603.50 4,005,757.55 0.00 400575.8 311,603.50 4094729.81 2064 4.01 80000 320,951.60 4,094,729.81 0.00 409473.0 320,951.60 4183251.19 2065 4.13 80000 330,580.15 4,183,251.19 0.00 418325.1 330,580.15 4270996.16 2066 4.26 80000 340,497.55 4,270,996.16 0.00 427099.6 340,497.55 4357598.22 2067 4.38 80000 350,712.48 4,357,598.22 0.00 435759.8 350,712.48 4442645.56 2068 4.52 80000 361,233.86 4,442,645.56 0.00 444264.6 361,233.86 4525676.26 2069 4.65 80000 372,070.87 4,525,676.26 0.00 452567.6 372,070.87 4606173.02 2070 4.79 80000 383,233.00 4,606,173.02 0.00 460617.3 383,233.00 4683557.32 2071 4.93 80000 394,729.99 4,683,557.32 0.00 468355.7 394,729.99 4757183.06 2072 5.08 80000 406,571.89 4,757,183.06 0.00 475718.3 406,571.89 4826329.48 2073 5.23 80000 418,769.04 4,826,329.48 0.00 482632.9 418,769.04 4890193.39 2074 5.39 80000 431,332.12 4,890,193.39 0.00 489019.3 431,332.12 4947880.61 2075 5.55 80000 444,272.08 4,947,880.61 0.00 494788.1 444,272.08 4998396.59 2076 5.72 80000 457,600.24 4,998,396.59 0.00 499839.7 457,600.24 5040636.01 2077 5.89 80000 471,328.25 5,040,636.01 0.00 504063.6 471,328.25 5073371.37 2078 6.07 80000 485,468.10 5,073,371.37 0.00 507337.1 485,468.10 5095240.41 2079 6.25 80000 500,032.14 5,095,240.41 0.00 509524.0 500,032.14 5104732.31 2080 6.44 80000 515,033.10 5,104,732.31 0.00 510473.2 515,033.10 5100172.44 2081 6.63 80000 530,484.10 5,100,172.44 0.00 510017.2 530,484.10 5079705.58 2082 6.83 80000 546,398.62 5,079,705.58 0.00 507970.6 546,398.62 5041277.52 2083 7.03 80000 562,790.58 5,041,277.52 0.00 504127.8 562,790.58 4982614.70 2084 7.25 80000 579,674.29 4,982,614.70 0.00 498261.5 579,674.29 4901201.87 2085 7.46 80000 597,064.52 4,901,201.87 0.00 490120.2 597,064.52 4794257.54 2086 7.69 80000 614,976.46 4,794,257.54 0.00 479425.8 614,976.46 4658706.83 2087 7.92 80000 633,425.75 4,658,706.83 0.00 465870.7 633,425.75 4491151.76 2088 8.16 80000 652,428.53 4,491,151.76 0.00 449115.2 652,428.53 4287838.41 2089 8.40 80000 672,001.38 4,287,838.41 0.00 428783.8 672,001.38 4044620.87 2090 8.65 80000 692,161.42 4,044,620.87 0.00 404462.1 692,161.42 3756921.54 2091 8.91 80000 712,926.27 3,756,921.54 0.00 375692.2 712,926.27 3419687.43 2092 9.18 80000 734,314.05 3,419,687.43 0.00 341968.7 734,314.05 3027342.12 2093 9.45 80000 756,343.48 3,027,342.12 0.00 302734.2 756,343.48 2573732.85 2094 9.74 80000 779,033.78 2,573,732.85 0.00 257373.3 779,033.78 2052072.36 2095 10.03 80000 802,404.79 2,052,072.36 0.00 205207.2 802,404.79 1454874.80 2096 10.33 80000 826,476.94 1,454,874.80 0.00 145487.5 826,476.94 773885.34 2097 10.64 80000 851,271.24 773,885.34 0.00 77388.5 851,271.24 2.63 Amount of Contribution is 0.14183934 or 14.18%
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