Monalisa is 35 years old and is drawing a monthly salary of RM4,000.00 in a government department. Her salary is expected to increase at an average rate of 6% per annum until retirement at age 60. In addition, it is assume that she needs 70% of his last drawn salary as first year annual income which shall go up in subsequent year at assumed inflation rate of 3% during retirement. Monalisa will park her retirement fund in an account that generates return of 5%. She is expected to live for another 30 years during retirement. It is assumed that the retirement gratuity will be used to cover some part of the retirement gap.

REQUIRED:

Calculate the value of pension fund at retirement age.

Answer rating: 100% (QA)

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