Retirement planning.

John and Jane will contribute to an RRSP until they are each 71. When they turn 71, CRA rules require them to switch their RRSPs to an annuity and begin receiving payments. John and Jane will receive their first payments on their (respective) 71st birthdays. Each wish to receive a payment of $10 000 per month until they die. If the annuity pays 5% interest compounded monthly, how much must they have saved in their RRSP if they live until their 81, 91 or 101 birthday? Both John and Jane have 10 000 which they will contribute to their new RRSP on their 31st birthday. Supposing that their RRSPs earn 12% compounded monthly what is Johns monthly contribution if he plans to live until 91? Similarly, what is Janes monthly contribution if she plans to live until 101? Saving for their childrens education To establish funds for a RESP (to be opened upon the birth of either Jack or Jill, whomever comes first) John has suggested purchasing bonds as a lower risk alternative to more volatile funds. John has identified a 20-year bond with a face value of $10,000 which pays a coupon rate of 9% compounded semi-annually. The bond has 15 years remaining until maturity and a current yield rate of 8%. John can purchase the bond for $10,125. Is this good value?