How much do you want to spend monthly when you retire? To determine if your goal is
Question:
How much do you want to spend monthly when you retire? To determine if your goal is feasible and /or adequate. you must determine how big of a "nest egg" you need when you retire. The optimal size of the nest egg is influenced by your age at retirement, life expectancy, savings, life style and the interest you earn. Historically. the stock market provides an average return between 8%-12%. However, if you do not want your life savings to be 100% invested in the stock market; you may use a lower interest rate, say 5%. In this course, as previously stated, I want you to apply what you learn to your life.
Useful links are provided below. You do not need to use them. In fact, you may just pick any life expectancy or base it on your relatives. It is up to you but you will find the websites interesting. Feel flee to discuss this projec with your classmates.
Answer the following:
A. How much money do you want to spend monthly after retiring? PMT = _____
B. At what age do you expect to "pass away?" (You can go to http://www.livincto100.com/calculator of Hun://www.deathclock.com/ to estimate your life expectancy or utilized the attached actuary table.) _______
C. At what age do you expect to retire? _________
D. Subtract C from B. ___________
E. Multiply D by 12. _____
F. What annual rate of interest do you expect to earn on your nest egg? (State I as percentage not in decimal form) I ___________ = /12 = ________(Example 1=10112 = .833 NOT .10/12 = .0083)
G. Let = O. Solve for PV. PV=____________
Managing Operations Across the Supply Chain
ISBN: 978-0078024030
2nd edition
Authors: Morgan Swink, Steven Melnyk, Bixby Cooper, Janet Hartley