Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You have met with your clients a few times and are now ready to do their retirement needs analysis (RNA). The couple, filing Married Filing

You have met with your clients a few times and are now ready to do their retirement needs analysis (RNA). The couple, filing Married Filing Jointly (MFJ), are both 39 years of age and expect to work another 23 years. They both plan on living to age 93. He currently earns $60,000; her $58,333. Returns are expected to be 8.2% and inflation 3.1%. You and the clients have determined that they will cut $47,234 of their current expenses out upon retirement, but that they will see an increase of $21,200 in other areas.

Given the information above, please calculate the following for your client:

What is your client’s Wage Replacement Ratio?

How much will they need to have saved at retirement to retire based on their WRR?


How much will they need to save each year from now until retirement to retirement comfortably?

How much will they need to save each year from now until retirement if they currently have saved $125,000 jointly in their 401(k)’s and ROTH IRAs?

If they currently have $400,000 saved, what annual rate of return do they need to earn, if they save $2,500 per month from now until retirement?

Step by Step Solution

3.51 Rating (158 Votes )

There are 3 Steps involved in it

Step: 1

A The client s wage replacement ratio is 80 5 To calculate the wage replacement ratio divide the amo... blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Mathematical Applications for the Management Life and Social Sciences

Authors: Ronald J. Harshbarger, James J. Reynolds

11th edition

9781337032247, 9781305465183, 1305108043, 1337032247, 1305465180, 978-1305108042

More Books

Students also viewed these Business Communication questions

Question

describe antecedents and consequences of quantitative job demands;

Answered: 1 week ago

Question

=+c. What is the probability that x exceeds 3?

Answered: 1 week ago

Question

=+d. What is the probability that x lies within .25 sec of 3?

Answered: 1 week ago