Business Administration - Financial Planning RFC230 Lecture 4: 12 Lesson 3 & 4 Retirement Planning
8 Mar 2017
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Set calculator at end: pv = ,000, n = 20, pmt = 0, fv = ,611, step 4: calculate savings needed at retirement to meet spending needs, pv = ,687,032, n = 20 (number of years in retirement) I/y = 3 (assumes minimum investment rate of return equal to inflation rate: pmt = ,611, fv = 0, set calculator at end, step 5: calculate annual savings required to meet retirement savings goal. Assume that the couple has already saved ,000 toward their retirement: pv = ,000, n = 20 (number of years to retirement, pmt = ,453 (end of each year) 2: fv = ,687,032, for most people, ,453 for the couple or ,727 per person is an unrealistic savings goal. This number may be reduced by retirement income sources, other than personal savings (e. g. cpp and oas): also, the 6% return assumes all savings will be in tax-sheltered accounts.
