Allison, age 40, earns $95,000 annually. She determined that she needs 70% of her current income in retirement. She expects inflation will average 3% over her entire life expectancy. She expects to work until 67, and live until 95. She anticipates a 7.5% return on her investments. Allison does not expect to receive any Social Security benefits. Calculate Allison’s annual retirement needs in today’s dollars
What is the amount of Allison’s first retirement distribution at age 67
Calculate Allison’s capital needed at retirement age 67