HOW MUCH YOU NEED TO SAVE PER MONTH TO HAVE 1 MILLION AT RETIREMENT (6% RETURN RATE ) $16000 $14,261 $14000 $12000 $10000 $8000 $6071 $6000 $4000 $3421 $2153 $1435 $990 $2000 $360 $500 $700 20 25 30 35 40 45 50 55 60 AGE WHEN YOU BEGIN SAVING MONTHLY SAVINGS TO GET TO $1M TECN NTES OF AMEMWA ITED Graph II - How Much Millennials, Gen X, and Boomers Have Saved for Retirement How Much Millennials, Gen X and Boomers Have Saved for Retirement MILLENNIALS 6.3% 2.2% (18-34) 42.2% 29.8% 11.2% 3.5% 4.9% GEN X (35-54) 29.8% 21.9% 11.2% 10.3% 8.8% 12.1% 6.2% 5.8% BOOMERS & SENIORS 28.0% 17.3% 8.7% 7.1% 10.3% 22.4% (55+) Don't have retirement savings Have saved Have saved Have saved $10K - $49K $100K - $199K $300K or more Have saved Have saved Have saved less than $10K $50K - $99K $200K - $299K Courtesy of GOBankingRates.com

1. You want to have an income of $50,000 per year in retirement, and you think you will be alive for 30 years in retirement. How much do you need to have invested the day you retire, in real dollars, assuming a 3% real rate of return?

Suppose a husband wants to take his wife on a trip three years from now to Europe to celebrate their 40th anniversary. He has just received a $20,000 inheritance from an uncle and intends to invest it for the trip. The husband estimates the trip will cost $26,600. What interest rate, compounded annually, must be earned to accumulate enough to pay for the trip? Note: Use tables, Excel, or a financial calculator

Peter and Blair recently reviewed their future retirement income and expense projections. They hope to retire in 29 years and anticipate they will need funding for an additional 20 years. They determined that they would have a retirement income of $62,000.00 in today's dollars but that they would actually need $86,142.00 in retirement income (in today's dollars) to meet all of their objectives. a. What is their annual shortfall at retirement assuming inflation of 3 percent per year? Click on the table icon to view the FVIF table: b. At the time that they retire, how much additional amount must they have accumulated to fund their retirement needs, assuming 3 percent inflation and a rate of return of 9 percent? Click on the table icon to view the PVIFA table: c. Calculate the additional amount that Peter and Blair must save each year for the next 29 years if they wish to completely fund their income shortfall. Click on the table icon to view the FVIFA table: