You have just turned 26, and you intend to start saving for your retirement. You

Question

You have just turned 26, and you intend to start saving for your retirement. You plan to retire in 40 years at age when you turn 65. During your retirement you would like to have an annual income of $140,000 per year for the next 27 years after retirement.
Calculate how much you would have to save between now and age 68 in order to finance your retirement income. Make the following assumptions: ? All savings draw compounded interest of 10 percent per year.
? You make the first payment today and the last payment on the day of your turn 68 (43 annual end of the year payments).
? You make the first withdrawal when you turn 68 and the last withdrawal when you turn 94 (26 annual withdrawals).

Explanation / Answer

Cash Needed at Age 68: ($1,282,532.37) PV(0.1,26,140000) Annual money needed 1984.839134 Using Goal Seek

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