Gary and Becky both age 40, currently make combined wages of $120,000/yr. They are savings 10% of their annual income on a monthly basis. Gary has a match inside his 401(k) that is equal to $6,000/yr., paid on a monthly basis. They have $185,000 saved for retirement. They project that inflation is 4% and that while working they will get an 8% rate of return and in retirement they project a 6% rate of return. They need a replacement ratio of 85%. They both plan to work until age 62 when they can begin collecting Social Security (combined benefit is $16,000 in todays dollars) and Becky will be able to receive her pension ($6,000/yr. in todays dollars). Their life expectancy is age 95.

How much will their salary be at age 62?

How much will their Social Security benefits expected to be?

How much is Beckys Pension benefit expected to be?