Question 4Mr Johnson has just retired at 65 with a defined contribution pension pot £125,000. He is asmoker and has chosen not to drawdown anything from the pot. Mr Johnson is not concernedwith inflation. From the following available annuities, what would be Mr Johnson's annualpension?AgeLevel RateSmoker Level RateSmoker 3% Escalation55£4,402£5,271£3,50260f4,836£5,770£4,03665£5,506f6,403£4,80570£6,306£7,443£5,75475£7,852£8,848£7,185All annuities have been calculated on a pension pot of £100,000.AnswerAnnual PensionA£6,003Вf6,006£6,883£8,004

The concept of perpetuity is an annuity with never-ending payments of a fixed present value and…

Question 4 Mr Johnson has just retired at 65 with a defined contribution pension pot £125,000. He is a smoker and has chosen not to drawdown anything from the pot. Mr Johnson is not concerned with inflation. From the following available annuities, what would be Mr Johnson's annual pension? Age 55 60 65 Smoker Level Rate £5,271 £4,836 £5,770 £5,506 £6,403 70 £6,306 £7,443 75 £7,852 £8,848 All annuities have been calculated on a pension pot of £100,000. Annual Pension £6,003 £6,006 £6,883 £8,004 Answer A B с Level Rate £4,402 D Smoker 3% Escalation £3,502 £4,036 £4,805 £5,754 £7,185

Question 4 Mr Johnson has just retired at 65 with a defined contribution pension pot £125,000. He is a smoker and has chosen not to drawdown anything from the pot. Mr Johnson is not concerned with inflation. From the following available annuities, what would be Mr Johnson's annual pension? Age 55 60 65 Smoker Level Rate £5,271 £4,836 £5,770 £5,506 £6,403 70 £6,306 £7,443 75 £7,852 £8,848 All annuities have been calculated on a pension pot of £100,000. Annual Pension £6,003 £6,006 £6,883 £8,004 Answer A B с Level Rate £4,402 D Smoker 3% Escalation £3,502 £4,036 £4,805 £5,754 £7,185

PFIN (with PFIN Online, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)

6th Edition

ISBN:9781337117005

Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Publisher:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk

Chapter14: Planning For Retirement

Section: Chapter Questions

Problem 2FPE

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