Question: Problem 6 . 9 : Brianna has done a pretty good job planning for her future, but she knows retirement is not that far off

Problem 6.9: Brianna has done a pretty good job planning for her future, but she knows retirement is not that far off and she needs to update her financial plans. Brianna plans to retire in 10 years and currently has $350,000 in a bond fund and $500,000 in a stock fund. In addition, she plans to invest $10,000 per year into her stock fund at the end of each of the next 4 years, and then up the amount to $12,000 per year at the end of the final 6 years until she retires.
a. Assuming Brianna's bond fund returns 5% compounded annually, and her stock fund will return 9% compounded annually, how much will Brianna have at the end of 10 years?
b. If Brianna expects to live for 25 years after she retires, and at retirement she deposits all of her bond and stock investments in a mixed retirement account paying 6%, how much can she withdrawal each year after she retires (making 25 equal withdrawals beginning one year after she retires) so that Brianna ends up with a zero balance at death? solve in excel

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!