Solution-Annual retirement needs, 1) Allison, age 40, earns

Annual retirement needs

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1) Allison, age 40, earns $81,915 annually; her wage replacement ratio has been determined to be 73%. She expects inflation will average 3% over her entire life expectancy. She expects to work until 67 and live until 95. She anticipates a 7.5% return on her investments. Allison expects to receive $19,685 in Social Security retirement benefits in today's dollars. What are Allison's annual retirement needs in today's dollars? [Round the final answer to the nearest cent]

2) Jordan is 22 years old and spends $113 per week on groceries. If inflation averages 3% per year, how much will Jordan spend on the same groceries when he is 63?

Reference no: EM133061125

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Annual retirement needs

Reference no: EM133061125

Reference no: EM133061125

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