Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Ben Marshall would like to retire at 65. At 50, he doesnt know if he can walt that long, but he does enjoy some aspects

image text in transcribed
Ben Marshall would like to retire at 65. At 50, he doesnt know if he can walt that long, but he does enjoy some aspects of his job as an archivist. His wife, Ann, is a dressmaker. In retirement, Ben and Ann dont plan to be very active. Thery thoroughiy enjoy their fiouise, working in the garden, or doing interior renovation jobs during the winter months. Their retirement income whil be made up of his defined-benefit pension benefics, her group RRSP, income from their other investinents, and cpe benefits. To be conservative., they whil ignore any old age security (OAS) benchis and consider this as extra should it stin be available upon their retirement, given the level of federal govemment spending and debt levels. Ben projects he will receive a CpP benefit of $800 a month at age 65 , and Ann, who has not warked full-time, will receive only $400. Ben's empioyer pension will be $22,000 a year, and Annis pension contubutions were invested in a group RRSP (induded in the total investments amount below), Qurrently, their registered investments (RRSP and group RRSP) total approximately $150,000 in a misture of stocks, bonds, and mutual funds, which is part of their retirement planning. Based on their current expenses, Ben and Ann estimate they will need about 552,000 at the beginning of each year, after tax, in today's dollars, to do all the things they want to do. This includes an amount to help support their godoaughter, who has a disability and to whorn they have been sending monthly amounts. For planning purposes, they are estimating a life span of 85 years of age for Ben, an inflation rate of 2%, a fax rate of 20%, and an investment rate of return of 6%, compounded annually, on their registered investments before and after retirement. The 6% return ha oeen estimated based on their preferred asset alle cation. ow much will the Marshalls have to save each year from now untal Ben's retirement in order to meet their retirement goal? Please s explain your work. You might want to create tables for your

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Management In The Public Sector Tools Applications And Cases

Authors: Xiaohu Wang

2nd Edition

0765625229, 9780765625229

More Books

Students also viewed these Finance questions

Question

Describe the factors influencing of performance appraisal.

Answered: 1 week ago

Question

3. Describe the process of a union drive and election.

Answered: 1 week ago

Question

2. What appeals processes are open to this person?

Answered: 1 week ago