Delbert Ray is planning to retire this year and draw upon the accumulated savings in his pension

Question:

Delbert Ray is planning to retire this year and draw upon the accumulated savings in his pension plan, which amount to $205,800. Mr. Ray is vested with 80 percent of the accumulated funds and, based on his life expectancy, has been promised an annual (income) rate of 3.5 percent. What is Delbert Ray’s expected annual retirement income from his pension plan?

Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,...