Question: Please show answer it in excel and show all formula and use the timeline method instead of others Today is your 40th birthday (this is

Please show answer it in excel and show all formula and use the timeline method instead of others

Today is your 40th birthday (this is the beginning of the period, i.e., time 0). You expect to retire at age 65 and actuarial tables suggest that you will live to be 85. You want to move to Hawaii when you retire (on your 65th birthday). You estimate that it will cost you $50,000 to make the move on your 65th birthday. Starting on your 65th birthday and ending on your 84th birthday (all withdrawals are at the beginning of the year), you will withdraw $40,000 for annual living expenses. Assume the interest rate is 4%.

  1. How much will you need to have saved by your retirement date (year 65)? Use the timeline method to solve this. (Hint: the present value, on your 65th birthday, of those costs (40,000 each year from years 65-84) as well as the $50,000 needed at age 65. The timeline method essentially implies that you are taking each cash flow separately and finding the present value of that cash flow.

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