# You estimate that by the time you retire in 35 years, you will have accumulated savings 0 of $2 million. If the interest rate is 8 percent and you live 15 years after retirement, what annual level of expenditure will those savings support? Unfortunately, inflation will eat into the value of your retirement income. Assume a 4 percent inflation rate

You estimate that by the time you retire in 35 years, you will have accumulated savings 0 of $2 million. If the interest rate is 8 percent and you live 15 years after retirement, what annual level of expenditure will those savings support? Unfortunately, inflation will eat into the value of your retirement income. Assume a 4 percent inflation rate and work out a spending program for your retirement that will allow you to maintain a level real expenditure during retirement.

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**Related Book For**

## Principles of Corporate Finance

7th edition

Authors: Richard A. Brealey, Stewart C. Myers

ISBN: 978-0072869460