Assume that you have estimated your retirement wealth needed to be $1,000,000, based on a 7 percent investment return, 4 percent inflation during retirement, and 20 years of retirement. If inflation turns out to average less than 4 percent per year during retirement, what will be the effect on your retirement wealth needed?

Question

Quizplus · Accepted Answer

If inflation is lower than expected, the purchasing power of your retirement wealth will be higher, meaning you will need less than the initially estimated $1,000,000 to maintain the same standard of living.

Assume That You Have Estimated Your Retirement Wealth Needed to Be