What equal annual ammount must garrett save at the end

Reference no: EM13258151

Garrett Erdle has just turned 26 years of age. Although Garrett currently has a negative net worth, he expects to pay off all of his financial obligations within four years and then to embark on an agressive plan to save for retirement. He wishes to be able to withdraw $100,000 per year during the first 10 years of retirement (the first withdrawl coming on his 61st birthday) and $150,000 during the next 10 years of retirement. As a precaution against unexpected longevity, he would like to have a net worth of $500,000 after the withdrawl on his 80th birthday. Garrett expects after-tax return on his investments to be 6 percent until he turns age 50, and 7 percent thereafter. What equal annual ammount must Garrett save at the end of each year (the first deposit will occur on his 31st and the last deposit will occur on his 60th birthday) to meet these retirement goals?

Reference no: EM13258151

Questions Cloud

Component of the assessment function of public health : It is a component of the assessment function of public health.It studies disease occurrence in humans

Cash discounton trade credit : The cost of not taking the cash discounton trade credit of 3/10, net 30 is equal to:

Completion of the reconciliation : The following information was available to the accountant of R&G Company when preparing the monthly bank reconciliation:

What was the holding period return : You sold a security for $980 that you purchased five years before for $795. What was the holding period return? Prove that this return overstates the annualized, compound return. Please explain how you got the answer.

What equal annual ammount must garrett save at the end : What equal annual ammount must Garrett save at the end of each year (the first deposit will occur on his 31st and the last deposit will occur on his 60th birthday) to meet these retirement goals?

What technical factors would in : Now try to lay out a speci?cation for your machine. Consider and justify the features and options that you would like your machine to have.

What is the approximate profitability index : If her cost of capital is 12 percent, what is the approximate profitability index?

How much was paid to suppliers in the month of february : Ann sell sports kit10% of sales are cash transaction and the remainder is on an month's credit. How much was paid to suppliers in the month of February2002.

Compute the propagation constant and intrinsic impedance : Consider a plane wave normally incident on a half-space of copper. If f=1GHz, compute the propagation constant, intrinsic impedance, and skin depth for the conductor. Also compute the reflection and transmission coefficients

User Account

All Pages