Jordan, age 46, currently makes $143,000. She expects that inflation will average 2.75 percent for her entire life expectancy. She expects to earn 8.5 percent on her investments and retire at age 65 and live to age 92. She has sent for and received her Social Security benefit statement, which indicated that her Social Security retirement benefit in todays dollars adjusted for early retirement is $20,000 per year. It is reasonable to subtract the Social Security benefit from todays needs because it is inflation adjusted.

A) How much money, in todays dollars, will need to withdrawn from Jordan's retirement savings for each year during retirement? Assume a SS/payroll tax rate of 7.65%, a savings rate of 12% during her career, and that her $2100 per month mortgage will be paid off the day before she retires.

B) Using the basic annuity method, calculate the amount of capital Jordan will need at retirement. Assume that she wants to receive her annual retirement income at the beginning of each year (annuity due).