Plan to retire-terms of real dollars

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Reference no: EM131583314

You plan to retire in 30 years. During retirement you will spend $70,000 (real dollars) per year at the end of each year for 20 years. You expect the stock market to return 8.5% (nominal) and inflation to be 2% per year. You anticipate to receiving an inheritance of $100,000 (real dollars) from your parents in 20 years from now.

How much (in terms of real dollars) do you need to save per year over the next 30 years to meet your retirement needs?

You must explain your steps and show calculator entries to receive any credit. No points for the final answer only.

Reference no: EM131583314

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