John has worked for the last fourteen years as an engineer for CNS Design. He has an $81,000 salary. He would like to retire at age sixty-seven.

Haley has worked as a CPA for seventeen years, the last fourteen of which have been out of their home. She also does consulting work from home. Though her earnings vary from month to month, she estimates that she will earn $65,000 this year. She wants to retire at the same time as John.

John and Haley also assume that their salaries will increase, on average, by 3.5 percent per year over their working lives. This year John and Haley anticipate earning $600 in interest and non-qualified mutual fund dividend distributions, which will be reinvested.

401(k) contributions are $540/monthly

John's employer matches 401(k) contributions $0.50 cents on the dollar

The Butterfields' savings ratio, using gross earned income and including employer 401(k) matching but excluding reinvested interest and dividends, is (rounded):

a.4 percent

b.10 percent

c.16 percent

d.22 percent