Estimating Future Retirement Needs

Alex and Jesse know that you are completing a personal finance course and that you understand how to complete a Projecting Retirement Income and Investment Needs worksheet. They have gathered the following information for you:

Both Alex and Jesse are $45$ years old and plan to retire when they reach age $65.$

Their estimated level of annual current household expenditures is $$65,000.$ They estimate that they will need $95\%$ in retirement.

They will receive $$1,556$ per month of Social Security income and no other sources of income $($except pension$).$

They talked with friends and believe that $8\%$ is a realistic rate of return on their investments once they retire.

Alex will have worked at Toyota for his entire career and will have an annual pension amount of $$20,925.$

Jesse will have worked at Microsoft for her entire career and will have an annual pension amount of $$12,500.$

Based on their Internet research, they will use $6\%$ as the average annual inflation rate for retirement calculations.

After contacting their savings and loan, they found out a savings account is currently paying $5\%.$

Use the following tables to identify the necessary future value interest factors.