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Tom and Donna Smith (age 56) agreed that they will require retirement income of $93,000 based on today's money. They plan to retire in 8

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Tom and Donna Smith (age 56) agreed that they will require retirement income of $93,000 based on today's money. They plan to retire in 8 years and wish to assume an after-tax return on their investments, prior to retirement of 8%. They plan to readjust their assets after retirement and believe that their net return will drop by 6%, They believe their retirement will last for 30 years and that inflation will average 2%. 1.How much income will Tom and Donna need in their first year of retirement? 2. What is the amount of capital necessary at the start of retirement to support their income needs throughout retirement? 3. For purposes of Social Security benefits, the Smiths reach full retirement at age 67 and full benefit is $30,000 in today's money. If they retire at 64, how much personal capital would they need to accumulate at retirement. 4. If they would like to leave $2 million to Goodwill at death, how much should they have extra when they retire at age 64. Tom and Donna Smith (age 56) agreed that they will require retirement income of $93,000 based on today's money. They plan to retire in 8 years and wish to assume an after-tax return on their investments, prior to retirement of 8%. They plan to readjust their assets after retirement and believe that their net return will drop by 6%, They believe their retirement will last for 30 years and that inflation will average 2%. 1.How much income will Tom and Donna need in their first year of retirement? 2. What is the amount of capital necessary at the start of retirement to support their income needs throughout retirement? 3. For purposes of Social Security benefits, the Smiths reach full retirement at age 67 and full benefit is $30,000 in today's money. If they retire at 64, how much personal capital would they need to accumulate at retirement. 4. If they would like to leave $2 million to Goodwill at death, how much should they have extra when they retire at age 64

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