Jamie Lee and Ross, now 57 and still very active, have plenty of time on their hands now that the triplets are away at college. They both realized that time has just flown by; over twenty-four years have passed since they married!

Looking back over the past years, they realized that they have worked hard in their careers, Jamie Lee as the proprietor of a cupcake caf and Ross, self-employed as a web-page designer. They have enjoyed raising their family and strived to be financially sound as they are looking to retirement that is just around the corner. They saved regularly and invested wisely over the years. They rebounded nicely from the economic crisis over the past few years, as they watched their investments closely and adjusted their strategies when they felt it necessary. They purchase vehicles with cash and do not carry credit card balances, choosing instead to use them for convenience only. The triplets are pursuing their master's degrees and have tuition covered through work/study programs at the university.

Jamie Lee and Ross are just a few short years from realizing their goals of retiring at 65 and purchasing a home at the beach!

They are reviewing their financial situation to ensure they will be ready for retirement. They anticipate being able to live comfortably with 80% of their current expenses. The rate of return on their investments until they retire is 3%. They expect this percentage to drop to 2% after retirement. Use this information, along with Exhibit 1-A, Exhibit 1-B, and the information provided below to determine the annual deposit amount Jamie Lee and Ross will need to make until they retire in order to make up the shortfall between their estimated expenses and income needed during retirement. Each answer must have a value for the assignment to be complete. Enter "0" for any unused categories.

Current Expense Amounts (Jamie Lee and Ross Combined)

Fixed expenses: $4,000/month

Variable expenses: $3,000/month

Estimated Income Amounts (Jamie Lee and Ross Combined)

Social Security: $2,050/month

Current IRA balance: $99,000

Estimated IRA withdrawal: $500/month

Other investments: $31,400/year

Exhibit 1-B Future Value (Compounded Sum) of $1 Paid In at the End of Each Period for a Given Number of Time Periods (an Annuity) B'% 5% 7% 9% 10% 11% 5% Period 2% 21 211 206 2 07 208 200 2 02 204 2 201 203 3 342 3215 3 246 1091 3.122 103 4 506 4 873 4 641 4 71 4 44 406 1 184 4 246 431 4.375 4 122 6.105 6 228 5 867 5:416 5 526 6 637 5.751 5.101 5 204 5.309 7 536 7 823 7 716 7913 7 153 6.308 6 633 6:975 9 487 0 783 6 152 8 923 92 8.304 7 214 7 434 7 652 7 808 8 142 8 654 10 26 10 63 11.030 11 430 11 05 0214 14 16 11.97 12 488 13/021 13.579 10 15 10 583 11 027 11.491 5937 16 72 9:360 12 578 13 181 13 016 14 48 5 190 10 93 11.46 2:006 19 561 0 162 15.784 16 645 5.531 12 008 14 446 14 207 14 972 20 141 21.384 22 713 11 11.867 12 16 15 917 16 87 17 883 18 97 13 413 14 192 15 026 21 493 22 083 24 623 12 2683 17 713 50 141 14 68 16 627 30 080 13 13 809 22 55 24 218 261010 27 975 17 086 19 500 21.015 14 947 15 974 20 061 31 772 21 579 21.276 25 129 27 183 201024 321000 30 10 15 16 097 17 20 25673 21 825 23 657 44 501 17 258 18 63 20 18 33 78 36074 10 545 30 84 21.76 231603 25 84 28 2:13 AT 18 43 20 012 37 48 41.501 28 132 51.150 56 930 0 615 21 412 15645 33.76 97 379 41.446 46 018 30 530 20 811 22 841 27 671 10 905 15 767 81.16 37 275 24 20 20.770 08.347 114 413 32 019 47 72 54 86 63 249 73.106 25 28 243 32 03 36.430 113 283 64.494 190 02 79 068 14 461 136.308 56 085 581 826 30 34. 785 40 56 47 85 120 8 154 762 100 635 250 087 337 842 142 503 60 40 75.40 98 026 815 084 1 163 909 1668 771 573 77 112 70 152 66 200 348 200.336 106 520 64.463 84 579 18% 19% 20% 25% 30%% 15% 16% 17% 12% 13% 14%% Period 2 25 23 1 2 16 217 210 219 214 215 364 3.813 3.90 212 213 3572 3 606 344 3473 3.506 3 407 5.368 5.766 6.18 3:374 5 141 5215 5 201 4.779 1921 4903 5066 5207 9 043 6877 7 014 7 154 7 207 6 48 161 6742 1. 250 12 75 8 971 9.207 9.442 5 683 8.32 8.754 8 115 12 52 12 016 15073 17 50 11 414 11 712 12 14 23 858 10 40 10 73 11067 4 173 15:327 15 902 16 409 0 842 3.727 123 12 75 13 23 14 24 25 802 32 015 B 17 519 18 285 191086 19 923 15 416 161085 16.786 14.776 24 708 25 980 5.253 42 610 20 304 21 321 17 549 18 42 19 397 30 404 32 15 12 365 56 406 21 814 24.340 25 733 201635 2310-45 37 10 30 501 5-4 300 11 1 031 25 63 27 371 07 62 30 80-4 12 219 45 244 48 401 58.76 32 08 36 786 13 28 020 20 983 54 841 50 106 86 949 127 913 37 58 10 503 43 672 IT 100 50 818 167 20 12 393 34 883 56 11 56 261 47 58 51 66 218 472 15 40 41 87 442 60 925 2 939 79 83 138 109 42 753 16 672 50 98 5.717 105 901 173.636 285 014 71 673 53 730 65 075 115.266 128 117 218 045 371 518 84 141 103.74 58 30 15.836 273 586 183 973 18 55.78 61 72 08 603 110.285 123 414 1:30 166 63 44 TO 74 78 06 10 212 165 418 186 686 342 045 630 168 01 02 602 444 115 3 301033 106 628 2348 803 2052 50 941 249 214 102 105 1-12 603 402 042 471.981 1084.791 181871 212 793 25 193.334 155 60 906 712 1181 682 3227 174 3 745 530 312 HIT 450 100 948 203 190 7343.808 30088 655 120302 883 241 333 5620 829 1013 704 1342 025 1779 09 2360 757 3134 122 4163 213 167 091 45497 191 200256 603 1690760 743 3450 807 1924 521 7217 716 10435 649 15080 502 21813 094 31515 316 2400 010