Question
Suppose you are exactly 25 years old. You believe that you will be able to save for the next 25 years until you are 50.
Suppose you are exactly 25 years old. You believe that you will be able to save for the next 25 years until you are 50. For 15 years following that, and till your requirement at age 65, you will not be able to save due to kid's college expenses, wedding...If you want to guarantee yourself $100,000 per year starting on your 66st birthday, how much should you save every year for the next 65 years, starting at the end of this year. Assume that your investment is expected to yield 8% and you are likely to live till 85. Draw timeline to solve the problem. (Show the working and formulas)
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