You are 25 and plan to retire in 40 years at age 65 with an inflation rate of 3.22%. Answer the following questions.
a. What amount the year you retire would be equivalent to $30,000 in today’s dollars? (round to a whole number).
b. If you want that amount each year adjusted for inflation and you did not want to erode your principle, how much would you need as a lump sum when you retire? Assume a 8% return on money.
c. How much would you need to save each month for the next 40 years, to get the amount you found in above (assume 8% return)?