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With no taxes or inflation (Spreadsheet 21.1), what would be your retirement annuity if you Increase the income growth by 1.0%? Retirement annuity $ 12,816 21.1 SPREADSHEET The savings plan E eXcel Please visit us at www.mhhe.com/bkm A B 1 Retirement Years Income Growth 2 25 .07 3 Age Income 4 30 50,000 5 31 53,500 9 35 70,128 19 45 137,952 29 55 271,372 39 65 533,829 40 Total 7,445,6731 D Savings Rate ROR 15 .06 Savings Cumulative Savings 7,5001 7,500 8,025 15,975 10,519 61,658 20,693 308,859 40,706 943,477 80,074 2,457,518 1,116,851 Retirement Annuity Consumption 42,500 45,475 59,608 117.259 230,666 453,755 192,244 A B C 1 Retirement Years Income Growth Savings Rate 2 25 .07 .15 3 3 Age Income Savings 4 30 50000 B4 $C$2 5 5 31 =B4 (1+$B$2) =B5 $C$2 39 65 =B38*(1+$B$2) =B39*$C$2 +$ 40 Total =SUM(B4:B39) ESUM(C4:C39) D E ROR .06 Cumulative Savings Consumption =C4 =B4-C4 =D4*(1+$D$2)+C5 =B5-C5 =D38*(1+$D$2)+C39 =B39-C39 Retirement Annuity PMT($D$2,$A$2,-$D$39,0,0) With no taxes or inflation (Spreadsheet 21.1), what would be your retirement annuity if you Increase the income growth by 1.0%? Retirement annuity $ 12,816 21.1 SPREADSHEET The savings plan E eXcel Please visit us at www.mhhe.com/bkm A B 1 Retirement Years Income Growth 2 25 .07 3 Age Income 4 30 50,000 5 31 53,500 9 35 70,128 19 45 137,952 29 55 271,372 39 65 533,829 40 Total 7,445,6731 D Savings Rate ROR 15 .06 Savings Cumulative Savings 7,5001 7,500 8,025 15,975 10,519 61,658 20,693 308,859 40,706 943,477 80,074 2,457,518 1,116,851 Retirement Annuity Consumption 42,500 45,475 59,608 117.259 230,666 453,755 192,244 A B C 1 Retirement Years Income Growth Savings Rate 2 25 .07 .15 3 3 Age Income Savings 4 30 50000 B4 $C$2 5 5 31 =B4 (1+$B$2) =B5 $C$2 39 65 =B38*(1+$B$2) =B39*$C$2 +$ 40 Total =SUM(B4:B39) ESUM(C4:C39) D E ROR .06 Cumulative Savings Consumption =C4 =B4-C4 =D4*(1+$D$2)+C5 =B5-C5 =D38*(1+$D$2)+C39 =B39-C39 Retirement Annuity PMT($D$2,$A$2,-$D$39,0,0)

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