Use this information for Q12 and 13. Rebecca calculated that she needs a total of $1,400,000 at retirement (beyond pensions and Social Security). Rebecca is 34 years old, investing aggressively and expecting to earn 7% in her retirement account. She plans to retire at age 62.
1. How much does Rebecca need to save annually to achieve her goal?
2. Once in retirement, Rebecca would like annual retirement income of $70,000. She would like the savings to last for 25 years during retirement. Assuming that she could earn a 4% after-tax and after-inflation rate of return on their investments, did she save enough?