(CIS331 -SystmMdlngThry) Retrmnt Planing & Kuwait Icebrgs Assgnmnt (Sprng 2010)

(CIS331 -SystmMdlngThry) Retrmnt Planing & Kuwait Icebrgs Assgnmnt (Sprng 2010)

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Retirement Planning 1. A ) What do we know ? The client wants to retire at a certain age and live comfortably thereafter. B ) What can we assume ? He does not want to suffer prior to retirement, so continuing to live as he has been. C ) What could the results look like ? We want provide the client with a single answer, instead we will design a model consisting of a variety of information that hopefully will be valuable to Bob in his retirement planning. D ) What information can be brought to bear ? Bob will use a set percentage of his income to contribute to savings. His income grows yearly at a certain (normally constant) rate. Bob’s retirement assets are earning money in the present. Expenses incurred during the first year post-retirement will be funded primarily from a pre-determined percentage of Bob’s income in his last working year. E ) What can we ask the client ? What do you consider ‘adequate’ savings? Is it more important to have disposable income now or increased savings later? What kind of travel are you expecting to do now and post-retirement? How concerned are you with your final assets at death? Would you like to consider the possibility of living beyond expected years? D ) Are there any similar situations or problems ? Bob primarily wanted to know the most beneficial methods of saving for retirement, but there are inter-related issues that should be addressed as well. One thought regards ensuring enough funds are stored in the college fund increases the chances of having everything covered so extra money will not have to come out of the retirement savings later; however, the same trade-off occurs: existing income will be reduced. Another thing to mention is the possibility of slightly lowering the amount of post-retirement travel so that comfortable retirement could be extended a few years. Both of these suggestions are similar to the trade-offs that will be discussed in the main retirement planning problem. 2. Formulate one or more problem statements. Our model will assess major decisions involving investments and income-management for retirement, as well as post-retirement consumption with the intent of making the issue easily approachable for the client when investigating his options. 3. What are the decisions, outcomes, and relationships in the problem? Decisions / Outcomes:
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Reducing or increasing savings rate / Influences present income and retirement assets Relationships: working life savings and retirement assets post-retirement consumption and remaining assets inflation’s impact on taxable amounts asset exhaustion will also depend on age lived to Final assets and their value being based on the amount of return on pre-retirement assets. 4. Draw an influence chart for the problem.
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 7

(CIS331 -SystmMdlngThry) Retrmnt Planing & Kuwait Icebrgs Assgnmnt (Sprng 2010)

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online