Henry and Andrea Young are both age 33. They come to you with the desire for assistance
Question:
Henry and Andrea Young are both age 33. They come to you with the desire for assistance in improving their family's financial position. They have one child who is 5 years old. Henry is a small business owner and his current annual earnings are $80,000 per year. Andrea is a pharmacist. Her current salary is $140,000 per year. The couple wants to retire at 68. The couple recently purchased a home for $300,000 with $20,000 as a down payment. They have taken a 30 year mortgage @4.5% annual interest rate for the remaining amount. They just made their 95thpayment. Their homeowner's insurance costs $120 per month and their real estate taxes are $6,000 annually. The couple's only other debt is a balance of $25,000 on their auto loan. They just took out the loan and have not yet made the first payment on it. Their car is worth $32,000 currently. The value of their investment portfolio is $10,000, and you should assume they will use this money for retirement.
- Using thecapital depletion approach, how much money do they need to have accumulated as of the day they retire?
The Legal Environment of Business A Critical Thinking Approach
ISBN: 978-0132664844
6th Edition
Authors: Nancy K Kubasek, Bartley A Brennan, M Neil Browne