lower interest rate , Which would not be so perilous . AS a result, $120, Jodis L, God, YOU Equals an interest rate of 7. 596 . AS per your advice , the vearly payment that they will receive will be much more than their requirement of $120 ,000 . If you were to consider yearly payments as calculated using the formula P = FIFTY'I - ( 1 + I'm " , where p , Or , I , and I are the payment , present Value . rate per period , and number of periods . In this model , it includes the life expectancy rate if Marilyn and David were to live that long . Moreover , the issue with this recommendation is the risk that fall ` follows it . Down below is the return rate of 15% calculated with a yearly return . Current Savings* $ 1. 600,000 Current Annual Living EXPENSES $120.000 Remaining Time in Years 25 Return 15% ['carly Return $247, 504 Hence , if you were to increase their cash flows to $ 130 , 000 it would only require a return of $196 , still below the national average . In this model , I reduced the return rate to 696 . In this fund , Marilyn and David will* receive what they were asking for with no risk involved . Current Savings $ 1. 600.000 Current Annual Living EXPENSES $ 120,000 Remaining Time in Years 25 Return 696 I'early Return $125. 175