You and your spouse are both years old. You earn $ and your spouse earns $ per year. You estimate you can live comfortably on a minimum of of your combined salaries in retirement, but hope to achieve more than that. You both plan to retire at age and move to a warmer climate. You\'ve changed jobs three times already in your career.

With your first employer, you are vested in a definedbenefit plan with a fixed monthly payment of $ if you begin taking benefits at age With your second employer, you had a k that you rolled into an IRA that is now valued at $ With your current employer, you have a k that is valued at $ Your spouse has a k that is currently worth $ You assume you will both live years beyond retirement.

Your current expectation is that together, you and your spouse, will require a minimum annual income of in retirement in today\'s dollars

For individuals born in or later, the fullbenefit retirement age is years of age. If you and your spouse decide to retire prior to this age, your basic retirement benefit will be permanently by per year for each year that you retire early. This means that if you elect to retire before the fullbenefit retirement age, you and your spouse will lose a total of of your expected Social Security benefits.

Use the table below to estimate your and your spouses expected annual Social Security benefits.

Present annual earnings

$

$

$

$

Fullbenefit annual retirement benefits $ $ $ $

Given the data in the table above, if you and your spouse retire at your fullbenefit age, you should expect to receive per year, while your spouse should expect to receive each year. This would result in a combined annual Social Security benefit income of

However, if you and your spouse elected to retire at age then your and your spouses expected Social Security benefits will be and respectively. Your combined Social Security retirement income is expected to total

According to the terms of your definedbenefit retirement account, you expect to receive a total income of per year, which is equal to of your minimum annual retirement income.

You and your spouse\'s combined IRA and k accounts are currently worth Assuming that you and your spouse both retire at age these three accounts will need to generate of additional income each year to achieve your desired minimum annual retirement income.

Assume that:

Your three IRA and k accounts can produce sufficient income, over that generated by your combined Social Security benefits and your definedbenefit retirement account, to achieve your desired minimum annual retirement income.

You and your spouse will live years after you both retire at age and your IRA and k accounts will continue to earn after you begin to make your annual withdrawals.

How much money will you need in your three IRA and k investments combined at the time you both retire to have sufficient income to last the rest of your lives? Note: The appropriate present value interest factor for and years is

$

$

$

$

If you and your spouse do not make any more contributions into your retirement accounts but the account balances grow at a rate of per year, then your three IRA and k accounts will be worth a total of when you and your spouse are years of age. Note: The appropriate future value interest factor at and years is