6. Your clients, Jamal and Chyna Gwynn, would like you to determine if they are on track to meet their retirement goal. Use the following assumptions to answer the Gwynns retirement planning questions: Jamal: Age forty eight Chyna: Age fifty Desired Retirement Age: When Jamal turns Age sixty two Age to Begin Receiving Social Security Benefits: Age sixty two Full Retirement Age: Age sixty seven Earned Income: Jamal $145,000 Earned Income: Chyna $210,000 Bonus: Jamal $25,000 Retirement Income Replacement Ratio: 90 Percent Investment Rate of Return Before Retirement: 7.90 Percent Investment Rate of Return After Retirement: 5.50 Percent Inflation Rate Assumption (Presently and Going Forward): 3.00 Percent Growth Rate of Retirement Savings and Social Security Benefits: 3.00 Percent Marginal Federal and State Marginal Tax Rate Before Retirement: 29 Percent Marginal Federal and State Marginal Tax Rate After Retirement: 29 Percent Annual Social Security Benefit at Full Retirement: Jamal $42,000 Annual Social Security Benefit at Full Retirement: Chyna $39,000 Other Income in Retirement: $80,000 Combined Retirement Assets Held in Tax-Deferred Assets: $1,500,000 Combined Retirement Savings Using Tax-Deferred Accounts: $42,000 Other Retirement Assets: $0

a. What is the retirement asset value needed on the first day of retirement, plus any additional annual savings needed per year, to fully meet a capital depletion retirement goal.

b. What is the value of assets needed to fund the capital preservation model of retirement? Can the Gwynns currently meet this need?