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a) Mr Benn desires to retire at age 55 and would like to receive a monthly income at the end of each month until he

a) Mr Benn desires to retire at age 55 and would like to receive a monthly income at the end of each month until he turns 95. The first payment will be 8000. Because he worries about the cost of living increasing as he gets older, he would like his monthly payments to increase by $50 each year. How much money would he need at age 55 to fund this retirement income if he can earn a nominal rate of interest convertible monthly of 3%? Round the answer to the nearest dollar.

b) Mr Benn is 39 today and wants to know if he already has enough money to fund his retirement income. He has 525000 in a saving account which earns a nominal rate of interest convertibly quarterly of 4% between now and when he turns 55. Does Mr. Benn have enough money saved for retirement? If not how much more he needs? Be sure to indicate if this amount is at age 55 or today. Round your answer to the nearest dollar.

c) To help fund his retirement income, Mr Benn has found an investment opportunity that earns an annual effective rate of 8% with contributions to the investment fund made at the beginning of the period. Mr. Benn would like to deposit a fixed percentage of his annual salary into this fund each year. Assume his salary at age 39 is $188,000 and he receives a 2% salary increase each year. Find the percentage of his salary he should contribute to this fund that would result in just enough money to fully fund his retirement income if he begins investing today and continues until he retires (note he still has access to the saving in part b)

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