I plan to retire in 45 years. At his time I will be 70 years old. I expect to li
ID: 2692480 • Letter: I
Question
I plan to retire in 45 years. At his time I will be 70 years old. I expect to live until I am 90. I believe I will need $120,000 per year to live. How much wealth will I need when I reach the age of 70? Assume a risk free rate of 3% for my retirement years. (a) How much will I have to save beginning today if interest is paid at the end of each year and is compounded annually? You should be able to answer this question for various investment rates. (B) What are the implications of your answer if I live to 100? What are the implications if I only live to 65?Explanation / Answer
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