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Information regarding retirement planning

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Reference no: EM133111633

Use the following information regarding your retirement planning:

  • You plan to work (and save) for 35 years, then retire (and spend money from your retirement account) for 15 years. After these 50 years, you would like your retirement saving account balance to have $275,000. You currently have $30,000 in your retirement account.
  • You plan to save $2,900 in year 1, and you will increase this amount by 2.5% a year
  • You want your retirement spending to increase by 1.5% per year
  • You expect to earn a rate of return of 5% during your working years and 4% during retirement
  • Cash flows occur at the end of each year

To solve this problem, find the amount that you spend your first year of retirement.

Reference no: EM133111633

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