In this assignment, you will use a simple version of a portfolio where your money is distributed across three categories: stocks, bonds, and cash. Refer to this modules readings to review historical return values.

Category	Average Annual Return
Stocks	6.0%
Bonds	2.1%
Cash	1.0%

Your portfolio will be diversified across these three different types of investments. The amount that you decide to put into each will greatly depend upon what stage of life you are in. If you are young and just starting out in your career, you may want to have a high-risk portfolio with the hope of high returns in the distant future. However, if you are near the end of your career, you may want to choose a less risky portfolio.

Create your own portfolio that addresses the following:

After retirement, how much will you like to have annually in order to maintain the standard of living that you expect to have?

How much annually do you plan to set aside for your retirement plan?

How much of this annual contribution will you want to invest in each of the investment categories?

How many years will you work from now until you retire?

Click here to download the retirement Excel spreadsheet you will need for this assignment.

Put the values that you decided on above into the retirement spreadsheet.

Respond to the following

What is your retirement goal? Can you realistically reach the goal that you have set? How long will it take to achieve this retirement goal?

How much money will you need to save in order to achieve your retirement goal?

This assignment assumes that the interest rates will remain constant for the entire life of the retirement plan. Is this a realistic situation?

Are you planning to have a high-risk or a low-risk portfolio? Explain.

What other factors related to contributing to the typical retirement plan must you consider when managing your portfolio?

What impact will inflation have on your calculations?

Years Until Retirement
Retirement Amount Goal
Total Future Value of Retirement Account
Difference
	Amount Invested Monthly		Annual investment	Future Value
Stocks	6%
Bonds	2.10%
Cash	1%