Hailings Review View Help (1) Provide four years of college education for Lauren and Luke, starting 11 years for Lauren and 13 years for Luke. The annual current college tuition is around $12,000, If each can finish in 4 years the annual outlays cover a 6-year period, beginning in eleven years. There are two years when both kids are at university together (2) Accumulate $500,000 (current purchase power) in their retirement account (3) Save $20,000 (current purchase power) as a family emergency fund. They want to have this fund ready in 2 years (4) Save $80,000 (current purchase power) as a down payment for a house that they want to build in 5 years (5) Take a European vacation 10 years in the future, as a celebration of their 20-year anniversary and the estimated cost is around $15.000 (current purchase power), Assumptions: (1) the inflation rate is 3%. This means they need more money by then to keep the same purchase power caused by inflation; (2) their saving can earn 8% return *I have done the first row calculations. For Lauren's year college because of 39 inflation, the required amount by then would be FV of 12,000 at 3% rate. The required annual saving means the amount they need to save at 8% rate in order to achieve the goal Make $16,611 as FV0 as PV, and calculate annual payment under 896 rate. Goals Years Amount required Inflation Inflation Required annual until goal adjusted amount Sarings at 8. achieved 1 Lauren college Year 1 $ 12,000 394 $16,611 $998 11 2 2 Year 2 12 12,000 3% Both Lauren and Luke college Year 3 2 13 24,000 3% 14 Year 4 24,000 394 Luke College Year 5 15 12,000 2 16 Year 6 12,000 39 2 37 396 2. Retirement 500,000 2 3. Emergency fund 20,000 39. 2 5 3% 4. House down payment 80,000 9 10 15.000 3% 5. European vacation Totals BA