You are 30 years old and you are thinking about life after work. Your salary is now $65,000. This salary is likely to grow at 2% per year for 35 years (in nominal terms, including inflation) until your retirement at the age of 65. You will be paying about 20% in taxes. You will start saving by the end of the year, in 12 months (your salary will still be 65,000), and you plan to save for the next 35 years (35 x 12 months). After retirement, you would like to visit your grandchildren and to travel the world. To afford this life style, you estimate that you will spend the equivalent to today's $4,000 per month. These expenditures will increase at the same rate as inflation, so you will not lose purchasing power. The inflation rate is expected to be 2%. Unfortunately, the average retired worker receives $1,420 according to the Social Security Administration (SSA). You hope that the SS check will also grow at the inflation per year, but this will not be enough. You are planning to save and to invest some money every month. You estimate that the average after-tax return on the savings will be 8% (by investing in a well-diversified portfolio of stocks). After retirement, you will invest all the savings in US treasuries, a safe investment but with a lower 3% interest rate. Realistically, you will enjoy retirement only for about 17 years (82 is about the average life expectancy). You wonder how much to save every month to be able to afford your desired life style after retirement. a) You need to save 6.5% of your salary a) You need to save 8.2% of your salary a) You need to save 6.9% of your salary a) You need to save 8.5% of your salary