Achieve in retirement to maintain their goal with inflation

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Reference no: EM131572830

Bill makes $56,000 per year, has $475,000 in a 403(k) and is 59 years old, estimates social security at 65 to be $32,000 per year, saves $700 per month making 7.1% on his 401(k). Diane is a teacher, making $53,000 per year, has a pension of 2.1% of her highest salary for each year of service and expects the final salary to be $56,000. She is 58 years old and has been teaching for 32 years. She has no social security or 403(b, but can start a 40(b) if she so wanted. They want to retire when Bill is 65 with today’s income. Their house will be paid off at 65 and both their children are in graduate school. Inflation is running 1.7%. Calculate to age 100 for both. How much will they need at retirement? Can they reach their goal, if not what should they do? What rate of return will they have to achieve in retirement to maintain their goal with inflation?

Reference no: EM131572830

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