The Retirement Problem

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The Retirement Problem

• John Zavros
• Computing Environments
• April 13, 2006

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Zavros35_at_Students.Rowan.edu
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Table Of Contents

• The Retirement Problem
• Table Of Contents
• How To Pick Retirement
• Example
• Salary Equivalent
• Amount Saved
• Annuity
• Calculations
• Lets See The Chart
• Are you ready to Start Saving
• Glossary
• Sources

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How To Pick Retirement

• There are many factors to consider when planning
  for retirement.
• How much money do I need to have saved after
  retirement to live comfortably?
• How much money do I have to save each year?
• Interests Rates?
• How long will I live?

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http//www.bestretireplans.com/
Table Of Contents
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Example

• I graduate college in 1 year
• I become a police officer within the next 2 years
• My starting salary is 40,000
• I retire at age 66.
• I plan to live age 87 (Average)
• I will live 21 years with no income
• I need to start saving right away

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http//www.chubb.com/
Table Of Contents
5
Salary Equivalent
I begin working at age 25 I plan to retire at age
66 Starting salary is 40,000 Inflation is 3 My
Salary Equivalent will be 134, 396 Retirement
Files\Exel equation 1.xls
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Table Of Contents
http//money.cnn.com/retirement/
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Amount Saved

• How much money do I need to save each year?
• The longer I wait the more money I will need to
  take out per pay check

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http//www.retirementlatest.com/
Table Of Contents
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Annuity

• How much money will I receive each year after
  retirement?

Retirement Files\Exel equation 2 and 3.xls
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Table Of Contents
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Calculations
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Table Of Contents
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Lets See The Chart
Table Of Contents
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Are you ready to Start Saving

• By saving early you will have more time to
  accumulate your savings
• Retirement savings will take a smaller portion
  out of your paycheck
• You can put aside smaller payments

http//personal.fidelity.com/planning/retirement/s
aving/content/reasons.shtml
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Table Of Contents
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Glossary

• Salary Equivalent Determine what your salary
  will be at the time of your retirement depending
  upon a given inflation rate.
• Amount Saved How much money you need to save
  each year so when you begin to draw on this money
  as an annuity for retirement, it will be very
  close to the target amount calculated
• Annuity A fixed amount that is distributed over
  the annuity period so that the last payment
  reduces the account to zero dollars.

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Table Of Contents
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Sources

• http//personal.fidelity.com/planning/retirement/s
  aving/content/reasons.shtml
• http//www.retirementlatest.com/
• http//money.cnn.com/retirement/
• http//www.chubb.com/
• http//www.bestretireplans.com/

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Table Of Contents