How much will you be able to withdraw per month to live off

Assignment Help Financial Management

Reference no: EM131952888

For your retirement planning, you are currently depositing $350 per month into an account that earns an 8% return, compounded monthly. In 12 years, you expect to increase that deposit by $250 per month (to a total of $600 per month). You plan to retire in 40 years. After you retire, you will move the money into a safe account that earns a guaranteed 3.5% per year.

a. How much will you have when you retire?

b. If you expect to live 35 years past retirement, how much will you be able to withdraw per month to live off of?

c. If you prefer to live off of the interest, thus creating a perpetuity and never touching the principal, how much will you be able to withdraw per month to live off of?

Reference no: EM131952888

Questions Cloud

Identify the four categories of ratios : Identify the four categories of ratios used to evaluate health care organizations.

What is the yield on one of these bonds : What is the yield on one of these bonds? Disregard cross-product terms; that is, if averaging is required, use the arithmetic average.

What is the value of the annuity in seven years : What is the value of the annuity today? What is the value of the annuity in 7 years?

The stock he shorted and original portfolio : If this transaction reduces the risk of his portfolio, what is the minimum possible correlation between the stock he shorted and his original portfolio?

How much will you be able to withdraw per month to live off : If you expect to live 35 years past retirement, how much will you be able to withdraw per month to live off of?

Expected one year capital gain yield on the bonds : What is the expected one year capital gain yield on the bonds of seattle seafood company?

Investors receive varies based on market conditions : Coupon payments are fixed, but the percentage return that investors receive varies based on the market conditions.

Exact forms for UIP and international Fisher effect : The NPV for the project using the exact forms for UIP and the international Fisher effect is $.

Interest rate parity in calculating the expected spot rates : Use the exact form of interest rate parity in calculating the expected spot rates. What is the NPV of the project in U.S. dollars?

User Account

All Pages