Elena Carrington is retiring at 60 next year. She was a nurse for 25 years, and put savings away in a retirement account. Her most recent statement shows she has $400,000 saved in the account.

1. Her son suggested taking the entire amount when Elena retires and investing them on her own. The funds would be subject to a personal tax of 35% if withdrawn from the account.
2. Elena's youngest daughter suggested taking half of the retirement funds right away to travel Europe while receiving the rest as an annuity over the next ten years. The initial withdrawal would be at a tax rate of 35% and the annuity at 15%.
3. Elenas oldest daughter reminded her that Elena's parents lived into their late 90's and suggested a more conservative approach. Elena could receive an annuity of $35,000 for 20 years. A personal tax rate of 15% would apply.
4. Elena could receive an annuity of $31,000 a year for 25 years. A personal tax rate of 15% would apply.

Ensure to use a discount rate of 8% for both (c) and (d)

Lastly, calculate after-tax proceeds for all four choices. What should Elena choose?