Jill (25) is single, does not have any dependents, and expects to retire at 60. Her annual salary is $60,000 per year.

1.) Assuming Jill takes the standard deduction and does not make any contributions to any IRA or a 401(k), how much in Federal income taxes will she owe for the current tax year?

2.) Assuming Jill makes the maximum allowable contributions to a traditional IRA and a 401(k), how much in Federal taxes will she owe for the current tax year?

3.) Assuming Jill makes the maximum allowable contributions to a Roth IRA and a 401(k), how much in Federal taxes will she owe for the current tax year? (No contribution to a traditional IRA, maximum contribution to a Roth IRA.)

4.)If Jill saves a total of $25,500 per year in her 401(k) ($19,500) and in her deductible traditional IRA ($6,000) accounts for the next 35 years (retiring at 60) and her investments grow by 5 percent per year, what will be the future value? (Assume it is an ordinary annuity payment.)

5.) Based on the future value calculated in question 4 above, and assuming Jill will receive annual payments for 20 years (at the beginning of each year) in retirement, how much annual after-tax income will Jill receive in retirement? (Assume a 20 percent tax bracket and that her retirement investments will grow by 5 percent per year.)

6.) If Jill saves a total of $25,500 per year in her 401(k) ($19,500) and Roth IRA ($6,000) accounts for the next 35 years (retiring at 60) and her investments grow by 5 percent per year, what will be the future value? (Assume it is an ordinary annuity payment.)

7.) Based on the future value calculated in question 6 above, and assuming Jill will receive annual payments for 20 years (at the beginning of each year) in retirement, how much annual after-tax income will Jill receive in retirement? (Assume a 20 percent tax bracket and that her retirement investments grow by 5 percent per year.)

8.) Based on your answers above, would you recommend Jill contribute currently to a Roth IRA or traditional IRA? Why?