Assume a traditional tax shelter Spreadsheet 21.6, calculate the effects of an increase of 1% in the lowest tax bracket to an increase of 1% in the highest tax bracket.

SPREADSHEET 21.6

Saving with a progressive tax

	A	B	C	D	E	F	G	H
1	Retirement Years	Income Growth	Rate of Inflation	Exemption Now	Tax rates in	Savings Rate	ROR	rROR
2	25	0.07	0.03	10000	Table 21.3	0.15	0.06	0.0291
3	Age	Income	Deflator	Exemption	Taxes	Savings	Cumulative Savings	rConsumption
4	30	50,000	1.00	10,000	8,000	6,300	6,300	35,700
5	31	53,500	1.03	10,300	8,716	6,718	13,396	36,958
9	35	70,128	1.16	11,593	12,489	8,646	51,310	42,262
19	45	137,952	1.56	15,580	32,866	15,763	248,018	57,333
29	55	271,372	2.09	20,938	76,587	29,218	731,514	79,076
39	65	533,829	2.81	28,139	186,335	52,124	1,833,644	104,970
40			Total	632,759	2,116,533	799,371	Real Annuity	37,059
41	RETIREMENT
42	Age	Nom Withdraw	Deflator	Exemption	Taxes		Funds Left	rConsumption
43	66	107,408	2.90	28,983	16,207		1,836,254	31,467
47	70	120,889	3.26	32,620	15,371		1,813,134	32,347
52	75	140,143	3.78	37,816	13,083		1,683,643	33,599
57	80	162,464	4.38	43,839	8,831		1,392,054	35,045
62	85	188,341	5.08	50,821	1,757		864,701	36,714
67	90	218,338	5.89	58,916	0		0	37,059
68	Total	3,916,018			227,675