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Your aunt Suzie expects to live another 10 years. (Should she live longer, you are expected to provide for her.). She currently has $50,000 in
Your aunt Suzie expects to live another 10 years. (Should she live longer, you are expected to provide for her.). She currently has $50,000 in savings which she wishes to spread evenly in terms of purchasing power over the remainder of her life. Since she feels inflation will average 6% annually, her annual beginning-of-year withdrawals should increase at a 6% growth rate. If she earns 8% on her savings not withdrawn, how much should her first withdrawal be?
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