A couple will retire in 40 years; they plan to spend about $39,000 a year (in current dollars) in retirement, which should last about 20 years. They believe that they can earn a real interest rate of 8% on retirement savings.

If they make annual payments into a savings plan, how much will they need to save each year? Assume the first payment comes in 1 year.

Note: Do not round intermediate calculations. Round your answer to 2 decimal places.

Annual Savings?

How would the answer to part (a) change if the couple also realize that in 15 years they will need to spend $69,000 on their childs college education?

Note: Do not round intermediate calculations. Round your answer to 2 decimal places.

Annual Savings?