# 4.1 Investor Expectations

(26 pages)
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## 4.1 Investor Expectations

Pages:
26
School:
University of Texas at Austin
Course:
Fin 320f - Foundations of Finance
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Unformatted text preview:

Two roads diverged in a wood, and I, I took the one less traveled by, And that has made all the difference Robert Frost US Pulitzer prize-winning poet laureate (1864 – 1963) Foundations of Finance 4.1 Investor Expectations 2011 -2023© H Toprac 3 Final Exam  The final exam will take place on Mon, Dec 17th, from 7:00 to 8:00 p.m. in UTC 2.102A  If you have another final exam at the same time, there is a make-up at 9:00 a.m. on the same day  You need my written permission to take the make-up final exam  From 1980 to 2007, US life expectancy increased from 70 to 75 years for men, and from 77 to 80 years for women  Your figure will rise or fall based on race, family health history and personal habits  Let’s assume you live to age 85  How much will it cost to support yourself? 2011 -2023© H Toprac 24 How much will you need?  In our example, your annual income at retirement was \$344,000  Assume that after retirement you need only 75% of your pre-retirement income  So you’ll need a mere \$258,000 per year  In other words, you’ll need a nest-egg of \$2,500,000 to last you until you’re 85 2011 -2023© H Toprac 25 Wait. What?!?

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