Agnes is 40 years old. She wants to know how much she should be saving each year for retirement. Below are the specifics: She wants to retire at 60 and expects to live until she’s 90 She currently makes $45,000 and expects that to increase each year with inflation. She thinks she will need about 70% of that to live on in retirement. She has $40,000 in an RRSP Her investments are earning a real rate of 6% return before retirement. When she retires she will move her investments into a more conservative portfolio and earn 3% per year. She expects that CPP will be about $15,000 per year in today's dollars. CPP amount is inflation adjusted. How much does she need to have saved at the time she retires (in real dollars)?

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To calculate how much Agnes needs to have saved at the time of retirement we can use the following s... View the full answer