1 Required annuity payments 2 3 Retirement income today 4 Years to retirement 5 Years of retirement 6 Inflation rate 7 Savings 8 Rate of return 9 10 Calculate value of savings in 10 years: 11 Savings at t = 10 12 HNMONO $50,000 10 25 6.00% $120,000 9.00% Formulas #N/A $284,083.64 #N/A #N/A 13 Calculate value of fixed retirement income in 10 years: 14 Retirement income at t = 10 $89,542.38 15 Calculate value of 25 beginning-of-year retirement 16 payments at t =10: 17 Retirement payments at t = 10 18 19 Calculate net amount needed at t = 10: 20 Value of retirement payments 21 Value of savings 22 Net amount needed 23 24 Calculate annual savings needed for next 10 years: 25 Annual savings needed for retirement #N/A #N/A #N/A #N/A