Question
Marcia Stubern is planning for her golden years. She will retire in 20 years, at which time she plans to begin withdrawing $60,000 annually. She
Marcia Stubern is planning for her golden years. She will retire in 20 years, at which time she plans to begin withdrawing $60,000 annually. She is expected to live for 20 years following her retirement. Her financial advisor believes she can earn 11% per year on annually. How much does she need to invest each year to prepare for her financial needs after her retirement?
Hint: This a two-step problem
First step; Is to determine how much money Marcia requires on the day she retires to fund her expected retirement of$60,000 per year with a 8% return
Second Step: is to find the annual payment that Ms. Stubern must make to fund the amount found in part one with an expected return of 11% for the next 20 years
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