Counting income from retirement funds

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Reference no: EM131014719

John just turned 30 and will retire from his job when he turns 63. When John turns 63, he will stop working completely and have an after tax household income (not counting income from retirement funds) of $22,000 per year. At that point his estimated remaining life expectancy will be 37 years. He would like to be able to spend $89,000 per year. Assume a real interest rate of 3%, how much does he need to accumulate by the time he turns 63, assuming that a combined federal and state average tax rate of 20%?

A) $1,942,540

B) $1,485,205

C) $1,885,961

D) $1,912,201

E) $1,856,506

F) $1,529,761

G) $2,479,000

Reference no: EM131014719

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