Saving Today for Retirement Tomorrow Crystal Malik is a 58-year-old mechanical engineereaming $60,000 per year. Crystal wants to retire in 12 years when she is 70. Crystal espects to live for 20 more years after she retires Crystal also expects her expenses to be about the same as they are now after she retires. She estimates that, along with her other sources of income and assets, by then, 100% of her current income will be necessary to support the lifestyle she desires. Crystal saves and invests but is pretty sure she should be saving more now to meet tomorrow's retirement goals. Using this information and the information in the following tables, complete the worksheet to determine if Crystal's current plan will enable her to reach her goals. Assume a 2% return and growth rate (adjusted for inflation) on all savings and investments. Round your answers to the nearest dollar. Enter ero (C) in any roves for which there is no figure. Any Social Security retirement benefits or portion payments are annual amounts. Savings & Investments - Current Balances Amounts that Crystal already has available in today'u dollars Employer savings plans: 30 . TRA and Keoghs: $10.000 Other investments $17.000 Home equity (net of possible replacement with new home after retiring): 50 Savings & Investments - Current Contributions Crystal saves or invests $900 per year Other Income According to Crystal's most current Social Security statement, her estimated monthly Social Security retirement benefit in today's dollars is $2,250. Crystal's employer offers a pension plan. According to the benefits advisor, Crystal's annual pension payment will be $30000. Interest Factors - Future Value of a Single Amount Interest Factors - Future Value of an Anruty Interest Factors - Present Value of an Annuity Years 10 596 1.6289 11 12 29 1.2190 1.2434 1.2682 1.2936 1.3195 1.3459 1.4802 1.5395 1.6010 1.6651 1.7317 1.8009 1.7103 1.7959 1.8856 1.9799 13 39 1.3439 1.3842 1.4258 1.4685 1.5126 1.5580 1.6047 1.6528 1.7024 1.7535 1.8061 2.4273 14 15 16 1.3728 1.8730 2.0789 2.1829 2.2920 17 1.4002 1.4280 18 1.9479 2.0258 2.1068 2.1911 2.4056 2.5270 19 1.4568 20 1.4859 2.6533 1.8114 30 40 3.2434 4.8010 4.2219 7.0400 2.2080 3.2620 5. 6. 7. dollars. Additional income needed at retirement in today's dollars. Amount Crystal must have at retirement in today's dollars to receive additional annual income in retirement Amount already available as savings and investments in today's dollars. A. Employer savings plans (such as 401(k), SEP-IRA, profit-sharing) B. IRAs and Keoghs C. Other investments, such as mutual funds, stocks, bonds, real estate, and other assets available for retirement D. Portion of current home equity considered savings, net of cost to replace current home with another home after retirement (optional) E. Totalt A through D Future value of current savings/investments at time of retirement III 5 $ 8. Saving Today for Retirement Tomorrow Crystal Malik is a 58-year-old mechanical engineereaming $60,000 per year. Crystal wants to retire in 12 years when she is 70. Crystal espects to live for 20 more years after she retires Crystal also expects her expenses to be about the same as they are now after she retires. She estimates that, along with her other sources of income and assets, by then, 100% of her current income will be necessary to support the lifestyle she desires. Crystal saves and invests but is pretty sure she should be saving more now to meet tomorrow's retirement goals. Using this information and the information in the following tables, complete the worksheet to determine if Crystal's current plan will enable her to reach her goals. Assume a 2% return and growth rate (adjusted for inflation) on all savings and investments. Round your answers to the nearest dollar. Enter ero (C) in any roves for which there is no figure. Any Social Security retirement benefits or portion payments are annual amounts. Savings & Investments - Current Balances Amounts that Crystal already has available in today'u dollars Employer savings plans: 30 . TRA and Keoghs: $10.000 Other investments $17.000 Home equity (net of possible replacement with new home after retiring): 50 Savings & Investments - Current Contributions Crystal saves or invests $900 per year Other Income According to Crystal's most current Social Security statement, her estimated monthly Social Security retirement benefit in today's dollars is $2,250. Crystal's employer offers a pension plan. According to the benefits advisor, Crystal's annual pension payment will be $30000. Interest Factors - Future Value of a Single Amount Interest Factors - Future Value of an Anruty Interest Factors - Present Value of an Annuity Years 10 596 1.6289 11 12 29 1.2190 1.2434 1.2682 1.2936 1.3195 1.3459 1.4802 1.5395 1.6010 1.6651 1.7317 1.8009 1.7103 1.7959 1.8856 1.9799 13 39 1.3439 1.3842 1.4258 1.4685 1.5126 1.5580 1.6047 1.6528 1.7024 1.7535 1.8061 2.4273 14 15 16 1.3728 1.8730 2.0789 2.1829 2.2920 17 1.4002 1.4280 18 1.9479 2.0258 2.1068 2.1911 2.4056 2.5270 19 1.4568 20 1.4859 2.6533 1.8114 30 40 3.2434 4.8010 4.2219 7.0400 2.2080 3.2620 5. 6. 7. dollars. Additional income needed at retirement in today's dollars. Amount Crystal must have at retirement in today's dollars to receive additional annual income in retirement Amount already available as savings and investments in today's dollars. A. Employer savings plans (such as 401(k), SEP-IRA, profit-sharing) B. IRAs and Keoghs C. Other investments, such as mutual funds, stocks, bonds, real estate, and other assets available for retirement D. Portion of current home equity considered savings, net of cost to replace current home with another home after retirement (optional) E. Totalt A through D Future value of current savings/investments at time of retirement III 5 $ 8
