Answers with explanation 69705)Anew graduate has successfully found their dream job and wants to start saving for71retirement. She has estimated she will need to be able to withdraw $5000 per month72from her retirement date. She plans on retiring in 30 years, and will start to save73using her company's 401(k). She believes that she can earn an average of 8% with74a diversified portfolio. If she plans on retiring at age 67, she wants to allow to receive75that income of $5000 per month for 20 years. She will start her monthly contribution76in 1 months time. How much should she save (including any company match) per month77to have enough money to withdraw her target amount per month for 20 years?78Recap: Save monthly for 30 years. Withdraw monthly for 20 years & balance goes to 0.7980Identify Variables;818283a)How much will she need to have saved by retirement?848586b)How much should she save each month to achieve her goal?8788Does this problem seem realistic to you? Why or why not? What assumptionswould you have changed?89c)9091929394959697

The retirement fund should have the present value annuity due of $5000 to be withdrawn per month for…

Anew graduate has successfully found their dream job and wants to start saving for retirement. She has estimated she will need to be able to withdraw $5000 per month from her retirement date. She plans on retiring in 30 years, and will start to save using her company's 401(k). She believes that she can earn an average of 8% with a diversified portfolio. Ifshe plans on retiring at age 67, she wants to allow to receive that income of $5000 per month for 20 years. Shewill start her monthly contribution in 1 months time. How much should she save (including any company match) per month to have enough money to withdraw her target amount per month for 20 years? Recap: Save monthly for 30 years. Withdraw monthly for 20 years & balance goes to 0. Identify Variables; How much will sheneed to have saved by retirement? How much should she save each month to achieve her goal? Does this problem seem realistic to you? Why or why not? What assumptions would you have changed?

Anew graduate has successfully found their dream job and wants to start saving for retirement. She has estimated she will need to be able to withdraw $5000 per month from her retirement date. She plans on retiring in 30 years, and will start to save using her company's 401(k). She believes that she can earn an average of 8% with a diversified portfolio. Ifshe plans on retiring at age 67, she wants to allow to receive that income of $5000 per month for 20 years. Shewill start her monthly contribution in 1 months time. How much should she save (including any company match) per month to have enough money to withdraw her target amount per month for 20 years? Recap: Save monthly for 30 years. Withdraw monthly for 20 years & balance goes to 0. Identify Variables; How much will sheneed to have saved by retirement? How much should she save each month to achieve her goal? Does this problem seem realistic to you? Why or why not? What assumptions would you have changed?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 10P

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A new graduate has successfully found their dream job and wants to start saving for retirement. She has estimated she will need to be able to withdraw $5000 per month from her retirement date. She plans on retiring in 30 years, and will start to save using her company's 401(k). She believes that she can earn an average of 8% with a diversified portfolio. If she plans on retiring at age 67, she wants to allow to receive that income of $5000 per month for 20 years. She will start her monthly contribution in 1 months time. How much should she save (including any company match) per month to have enough money to withdraw her target amount per month for 20 years? Recap: Save monthly for 30 years. Withdraw monthly for 20 years & balance goes to 0. a) How much will she need to have saved by retirement? b) How much should she save each month to achieve her goal?
A new graduate has successfully found their dream job and wants to start saving for retirement. She has estimated she will need to be able to withdraw $5000 per month from her retirement date. She plans on retiring in 30 years, and will start to save using her company's 401(k). She believes that she can earn an average of 8% with a diversified portfolio. If she plans on retiring at age 67, she wants to allow to receive that income of $5000 per month for 20 years. She will start her monthly contribution in 1 months time. How much should she save (including any company match) per month to have enough money to withdraw her target amount per month for 20 years? Recap: Save monthly for 30 years. Withdraw monthly for 20 years & balance goes to 0.
A new graduate has successfully found their dream job and wants to start saving for retirement. She has estimated she will need to be able to withdraw $5000 per month from her retirement date. She plans on retiring in 30 years, and will start to save using her company's 401(k). She believes that she can earn an average of 8% with a diversified portfolio. If she plans on retiring at age 67, she wants to allow to receive that income of $5000 per month for 20 years. She will start her monthly contribution in 1 months time. How much should she save (including any company match) per month to have enough money to withdraw her target amount per month for 20 years? Recap: Save monthly for 30 years. Withdraw monthly for 20 years & balance goes to 0. a) How much will she need to have saved by retirement? b) How much should she save each month to achieve her goal? c) Does this problem seem realistic to you? Why or why not? What assumptions would you have changed?
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