Question
Pat is the type to plan everything in advance, and she is already starting to plan for retirement. She plans to work for 40 years,
Pat is the type to plan everything in advance, and she is already starting to plan for retirement. She plans to work for 40 years, and then retire for the following 30 years. She expects to spend $100,000 in her first year of retirement, with a 2.5% growth rate. She will increase her working-years savings rate by 5% per year. While working, she expects her account will have a 6.75% return, and during retirement it will have a 3.75% return. After the 30thyear of retirement, she wants to have $250,000 in her account for safety net and bequest reasons (It is fine if the amount is not exactly $200,000 due to rounding error). Her retirement savings account currently has $0.
To solve the problem, determine how much Pat needs to save in year 1 to accomplish her retirement goals (use Solver or Goal Seek).
please explain me how to find answer using solver or goal seek in excel for this question
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started