Ryan Daniels, aged $27,$ graduated five years ago with a degree in

food marketing and is currently employed as a middle$-$level manager for a fairly

successful grocery chain. His current annual salary of $$70,000$ has increased at an

average rate of $5$ percent per year and is projected to increase at least at that rate for

the foreseeable future. The firm has had a voluntary retirement savings program in

place, whereby employees are allowed to contribute up to $11\%$ of their gross annual

salary $($up to a maximum of $$12,000$ per year$)$ and the company matches every dollar

that the employee contributes. Unfortunately, like many other young people who start

out in their first $$real$$ job, Ryan has not yet taken advantage of the retirement savings

program. He opted instead to buy a fancy car, rent an expensive apartment, and

consume most of his income.

However, with wedding plans on the horizon, Ryan has finally come to the

realization that he had better start putting away some money for the future. His

fianc$$e$,$ Amber, of course, had a lot to do with giving him this reality check. Amber

reminded Ryan that besides retirement, there were various other large expenses that

would be forthcoming and that it would be wise for him to design a comprehensive

savings plan, keeping in mind the various cost estimates and timelines involved.

Ryan figures that the two largest expenses down the road would be those

related to the wedding and down payment on a house. He estimates that the wedding,

which will take place in twelve months, should cost about $$15,000$ in today$$s dollars.

Furthermore, he plans to move into a $$250,000$ house $($in today$$s terms$)$ after $5$ years,

and would need $20\%$ for a down payment. Ryan is aware that his cost estimates are in

current terms and would need to be adjusted for inflation. Moreover, he knows that an

automatic payroll deduction is probably the best way to go since he is not a very

disciplined investor. Ryan is really not sure how much money he should put away

each month, given the inflation effects, the differences in timelines and the salary

increases that would be forthcoming. All this number crunching seems overwhelming

and the objectives seem insurmountable. If only he had started planning and saving

five years ago, his financial situation would have been so much better. But, as the

saying goes, $$It$$s better late than NEVER!$$

Solve question $1$ using excel

$1.$ What was Ryan$$s starting salary? How much could he have contributed to the

voluntary savings plan in his first year of employment?