Saben is 40 and wants to retire in 20 years. His family has a history...
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Saben is 40 and wants to retire in 20 years. His family has a history of living well into their 90s. Therefore, he would like to plan on living until age 100, just in case. He currently needs $100,000 and expects he will need about 80% of that if he were retired. He can earn 9 percent in his portfolio and expects inflation to be 3 percent annually. Some years ago, he purchased an annuity that is expected to pay him $30,000 per year beginning at age 60. it includes an inflation rate cost of living adjustnent . in addition, he received $500,000 from his uncle BJ when he died. Saben has spent $200,000 on his home but is investing $300,000 for his retirement. His social security benefit in today's dollars is $20,000. Calculate his capital need analysis how much does he need to fund his retirement and how much does he need to save each month to reach that amount.
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