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You are trying to get your retirement savings in order. You plan to retire in 27 years. For retirement, you calculate that you will need
You are trying to get your retirement savings in order. You plan to retire in 27 years. For retirement, you calculate that you will need $75,000 per year in todays dollars, and that you will start taking annual withdrawals from the account 27 years from today. To be safe, you assume you will need to make 40 withdrawals (i.e., live 40 years in retirement), and you assume inflation will be 2% per year forever. A) How much do you need in your retirement account one year before your first withdrawal assuming the account earns 8% per year?
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