Stefani German, a 40-year-old woman, plans to retire at age 65, and she wants to accumulate $450,000 over the next 25 years to supplement the retirement programs provided by the federal government and her employer. She expects to earn an average annual return of about 6% by investing in a low-risk portfolio containing about 20% short-term securities, 30% common stock, and 50% bonds. Stefani currently has $37,280 that at an annual rate of return of 6% will grow to about $160,000 by her 65th birthday (the $160,000 figure is found using time value of money techniques, Chapter 4 Appendix.) Stefani consults a financial advisor to determine how much money she should save each year to meet her retirement savings objective. The advisor tells Stefani that if she saves about $18.23 each year, she will accumulate $1,000 by age 65. Saving 5 times that amount each year, $91.15, allows Stefani to accumulate roughly $5,000 by age 65. a. How much additional money does Stefani need to accumulate over time to reach her goal of $450,000? b. How much must Stefani save to accumulate the sum calculated in part a over

the next 25 years?