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Someone you know needs advice on how much money to save for retirement. He wants to save enough to have an annual retirement income of $80,000 per year for 30 years. He has a 401K play and his company matches his contribution up to 10% of his income. Your friend makes $100,000 per year and expects to retire in 25 years. The expected annual return on his 401K over the next 25 years is 6%. Also, he expects to be able to earn a 6% rate of return on his unspent retirement money during his retirement years. What percentage of his income should he contribute each year in order to achieve his retirement goal?

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Financial Management, Finance

Category:- Financial Management
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