Question: An investor plans with a $ 1 0 0 , 0 0 0 salary plans to retire in 3 0 years. He expects a 5

An investor plans with a $100,000 salary
plans to retire in 30 years. He expects a 5%
annual raise and plans to save 20% of his
salary for retirement at the end of each year.
He invests all his savings in a target-date fund
which reallocates between stocks and bonds
over time, becoming more conservative as the
retirement date approaches.
Asset Allocation: At time t, the fund allocates
(103-3t)% to stocks and (3t)% to bonds. For
example:
An investor plans with a $100,000 salary plans to retire in

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