You are trying to decide if you have enough money to retire. You are expecting $2,500 a month from Social Security. You have $1.2 million in your retirement savings, and you only want to use the earnings to live on, which is at an 8% annual rate. You are currently making $64,000 a year and plan to live on 80% of that amount. Do you have enough to retire based on these numbers?
.08 on your 1.2 million will yield
96000 a year or $8000 per month
you want to live on 80% of 64000 = 51200
or 4266.67
and you are getting 2500 per month from SC
so all you need from you nest-egg is $1766.67 per month
The problem is that you are not likely to get 8% these days.
1. Suppose you borrowed $25,000 for a car at an APR of 8%, which you are paying off with monthly payments of $510 for 5 years.
a) What’s the loan principal?
b) What’s the annual interest rate?
c) How many payments do you make in a year?
d) What’s the loan term?
e) What’s the payment amount?
f) How many loan payments does the loan require?
g) What is the total amount paid over the full term of the loan?
h) Of the total amount paid, what percentage is paid toward the principal?
i) Of the total amount paid, what percentage is paid for interest?
To determine if you have enough money to retire, you'll need to calculate your retirement income based on the information provided. Here's how you can do that:
1. Calculate your annual retirement income from Social Security:
Monthly Social Security income = $2,500
Annual Social Security income = $2,500 * 12 = $30,000
2. Calculate the total retirement income from your savings:
Annual retirement income from savings = $1.2 million * 8% = $96,000
3. Calculate your desired annual retirement income based on 80% of your current salary:
Desired annual retirement income = 80% of $64,000 = $51,200
4. Add the Social Security income and retirement income from savings:
Total retirement income = Annual Social Security income + Annual retirement income from savings
= $30,000 + $96,000 = $126,000
5. Compare the total retirement income to your desired annual retirement income:
If the total retirement income is equal to or greater than your desired annual retirement income, you have enough money to retire. Otherwise, you may need to adjust your retirement plans accordingly.
In this case, the total retirement income is $126,000, which is higher than the desired annual retirement income of $51,200. Therefore, based on these numbers, you have enough money to retire.