Consider that you are 35 years old and have just changed to a new job. You have $86,000 in the retirement plan from your former employer. You can roll that money into the retirement plan of the new employer. You will also contribute $4,200 each year into your new employer’s plan. If the rolled-over money and the new contributions both earn a 7 percent return, how much should you expect to have when you retire in 30 years? (Do not round intermediate calculations and round your final answer to 2 decimal places.) FUTURE VALUE?

Consider that you are 35 years old and have just changed to a new job. You have $86,000 in the retirement plan from your former employer. You can roll that money into the retirement plan of the new employer. You will also contribute $4,200 each year into your new employer’s plan. If the rolled-over money and the new contributions both earn a 7 percent return, how much should you expect to have when you retire in 30 years? (Do not round intermediate calculations and round your final answer to 2 decimal places.) FUTURE VALUE?

Personal Finance

13th Edition

ISBN:9781337669214

Author:GARMAN

Publisher:GARMAN

Chapter2: Career Planning

Section: Chapter Questions

Problem 3DTM

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1. Assume that you begin saving 3% of your total income in an employer-provided retirement plan at work. How long will it take for you to be saving at least 20% of your income if your employer provides a 4% wage increase yearly and you save half of each year's increase? 2. Based on your calculations from part a. how much will you be saving (using the end-of- year savings rate) over the next 10 years if you earn $30,000 this year?
Q4. You have just made your first $5,000 contribution to your individual retirement account. Assuming you earn an annual rate of return of 9.75 percent and make no additional contributions, what will your account be worth when you retire in 45 years?
Q21 Consider that you are 45 years old and have just changed to a new job. You have $145,000 in the retirement plan from your former employer. You can roll that money into the retirement plan of the new employer. You will also contribute $6,700 each year into your new employer’s plan. If the rolled-over money and the new contributions both earn a return of 9 percent, how much should you expect to have when you retire in 20 years? (Do not round intermediate calculations and round your final answer to 2 decimal places.) FUTURE VALUE?
Consider that you are 30 years old and have just changed to a new job. You have $91,000 in the retirement olan from your former employer. You can roll that money into the retirement plan of the new employer. You vill also contribute $400 each month into your new employer's plan. If the rolled-over money and the new contributions both earn a 7 percent annual return, how much should you expect to have when you retire in 38 years? O $2,019,095.26 O $2,195,145.40 $2,298,025.12 $2,301,116.92
Problem Outline Part A By the end of this year, you will be 35-years old, and you want to plan for your retirement. You wish to retire at the age of 65, and you expect to live 20 years after retirement. Upon retirement you wish to have an annual sum of $50,000 to supplement your social security benefits. Therefore, you opened your retirement account with a 7% annual interest rate. At retirement you liquidate your account and use the funds to buy an investment grade bond which makes $50,000 annual coupon payments based on a 6 % coupon rate throughout your retirement years. What is the face value, not the actual value, of the bond that you will be investing in? Calculate the monthly payment in your retirement account to be able to achieve the plan mentioned above. How much will your inheritors receive? Problem Outline Part B Suppose you think if you were to retire right now, you would have needed $50,000 each year to supplement your social security and maintain your desired…
Part A: By the end of this year, you would be 35 years old and you want to plan for your retirement. You wish to retire at the age of 65 and you expect to live 20 years after retirement. Upon retirement, you wish to have an annual sum of $50,000 to supplement your social security benefits. Therefore, you opened now your retirement account with a 7% annual interest rate. At retirement, you liquidate your account and use the funds to buy an investment-grade bond which makes $50,000 annual coupon payments based on a 6 % coupon rate, throughout your retirement years. How much will the face value of the bond that you will be investing? Please calculate the monthly payment in your retirement account in order to be able to achieve the plan mentioned above? How much will your inheritors receive?
Question 4. Time Value of Money a. At age 60, you find that your employer is moving to another location. You do not wish to move and instead will receive a termination package of $100,000. You don't want to retire for another 5 years so you take a job in your current location, which just covers your living expenses. If you invest the $100,000 at 8% today, how much will you have when you retire in 5 years? b. Deposited $50,000 in a debt retirement fund. Interest will be compounded annually and added to the funds at the end of each year. Given a 8% interest rate, what will be the balance in the fund at the end of year 3? What is the total amount of interest revenue that will be earned?
Saved You have just made your first $4,000 contribution to your retirement account. Assume you earn a return of11 percent and make no additional contributions. a. What will your account be worth when you retire in 40 years? Future value for starting now b. What will your account be worth if you wait 7 years before contributing? Future value if waiting 7 years
After retirement, you expect to live for 25 years. You would like to have $91,000 in income each year. How much should you have saved in your retirement account to receive this income if the annual interest rate is 9 percent per year? (Assume that the payments start one year after your retirement) Multiple Choice $1,472.33173 $893,85474 $2,275,000.00 $101,089.74
You feel that you will need $2.3 million in your retirement account and when you reach that amount, you plan to retire. You feel you can earn an APR of 10.3 percent compounded monthly and plan to save $320 per month until you reach your goal. How many years will it be until you reach your goal and retire? Multiple Choice 37.25 years 42.21 years 49.91 years 34.59 years
You want to retire exactly 35 years from today with $2,080,000 in your retirement account. If you think you can earn an interest rate of 10.59 percent compounded monthly, how much must you deposit each month to fund your retirement? Multiple Choice $4,952.38 $558.12 $465.90 $501.34 $470.01
Part A: By the end of this year, you will be 35-years old, and you want to plan for your retirement. You wish to retire at the age of 65, and you expect to live 20 years after retirement. Upon retirement you wish to have an annual sum of $50,000 to supplement your social security benefits. Therefore, you opened your retirement account with a 7% annual interest rate. At retirement you liquidate your account and use the funds to buy an investment grade bond which makes $50,000 annual coupon payments based on a 6 % coupon rate throughout your retirement years. What is the face value, not the actual value, of the bond that you will be investing in? Please calculate the monthly payment in your retirement account in order to be able to achieve the plan mentioned above. How much will your inheritors receive?