Question
The client who gets enrolled in the pension plan at age 35 needs to make an annual deposit till age 65 ( the age of
The client who gets enrolled in the pension plan at age 35 needs to make an annual deposit till age 65 ( the age of retirement). After retirement, he/she plans to withdraw $30,000 every year until 80. Suppose the annual interest rate is 6%. Assume all the deposits and withdrawals happen at the end of each year. (a) How much annual deposit should the client make? (b) [Use DataTable in Excel] Sensitivity: What is the size of the annual deposit if the client expect to withdraw $35,000, $40,000,$45,000, $50,000, $55,000, or $60,000 every year after retirement ?
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