1. Assume that you begin saving 3% of your total income in an employer-provided retirement plan at work. Each year, your income increases by 4%. As a result, you increase the percentage of your income you devote to your retirement plan by 2%. How long will it take for you to be saving at least 20% of your income? 
2. Based on your calculations , how much will you be saving (using the end-of-year savings rate) over the next 10 years if you earn $30,000 this year?
3. What is an alternative approach you might recommend for this situation? Why might it be better?

Answer rating: 100% (QA)

1 Determining the time to reach 20 savings rate Initially you save 3 of your income and each year you increase your savings rate by 2 This means that ... View the full answer