Christy and Michael are trying to decide if they will have enough money to retire early in 15 years, at age 60. Their current assets are $250,000 in retirement plans and they have $100,000 in other investments. Together, they contribute $30,000 per year to their retirement plans and another $6,000 to other investments.
a. If their assets grow at 9 percent per year, how much money will they have when they turn 60?
b. After they retire, they will invest their wealth more conservatively and it will earn 6 percent per year. What will be the amount of their annual payments if their expect to live for 30 years in retirement?