How long retirement account will last

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Question: How Long Retirement Account Will Last? Suppose you are planning for retirement. You currently have $6,000 to invest and plan to start investing $6,000 per year in a tax advantaged account, perhaps a Roth IRA, in order to plan for retirement. Money will be added in a lump sum at the end of each year. You expect to retire early at age 50, and at that time will stop adding funds to your account. However, you don't plan to make any withdrawals until age 60, at which time you will convert the entire portfolio into a low risk fixed income where you will earn 3% per year. Once you retire, you plan to withdraw $75,000/year. How many years will your nest egg last? Hint: use NPER function to calculate how long the portfolio will last in retirement. Assumptions: Amount to invest per year: $6,000 Number of years to invest: 28 Years of growth without additional investment: 10 Rate of return: 7.5% Rate of return retirement portfolio: 3% Annual withdrawal upon retirement: $75,000 1. Create a flexible model showing investment value each year. This means your model should allow for each of the inputs to be varied, updating the outputs automatically.

Reference no: EM133633161

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