How long will you live



Consumer Project- Investing Webquest – Due Dec. 3rd/4th 54444903746500This is a web-based exploration of investment/retirement planning information. This portion of your project requires two things:1) completed webquest (this packet)2) your reflectionThere is no evidence for this section other than the two things listed above. Your grade on this section is dependent upon your completion of the webquest and the thoughtful quality of your reflection.How long will you live? Of course no one really knows how long they will live. What we do know is that the lifestyle choices you develop will have a big impact on your length of life. Find out how much… this on how you currently live! What choices made your life expectancy go down? What choices made your life expectancy go up?What was your final calculation?What does all of this have to do with economics and investing? Your life expectancy has everything to do with your financial security. Will you have enough money in retirement to live the way you want to live for as long as you may live? Why should you care now? Check it out… with: $1000 (gift from Grandma)Base your monthly contribution on how much you can afford in the project – then change up the numbers a few times to see how it impacts the speed at which you reach your goalAverage rate of return: 8%Inflation: 2%Goal amount: That’s up to you! Try 500,000, then 1,000,000. Then set your own goalWhat goal (amount) did you choose?How long will it take to get there?Many financial planners tell you to view the money you will have in retirement as coming from three different sources: a company retirement plan, social security, and your own 401K or IRA account. What’s a 401k? is a 401k?How does it work?What is the most common percent of employer matching?What’s the difference between a traditional and Roth 401K?Another type of investment plan is what’s known as an IRA or an Individual Retirement Account. What is an IRA? is an IRA?What is the difference between the 3 types of IRAs?Why is it advisable to also invest in an IRA?Why 401ks Help You Pay Less In Taxes! Money you put into a 401k or IRA is known as a pretax contribution. This means that the amount you choose to invest is deducted from your paycheck first, then the amount of tax that has to be deducted from your paycheck for federal and state taxes is calculated. This means that you pay less in federal and state tax than you normally would if no money was deducted for a 401k or IRA.Calculate it to understand… in 10% to contribute.Enter your annual salaryEnter an annual salary of 5% if working for the private sector, 2% if working for the public sector.Current age of 28Age of retirement – usually it’s 65, but if you think you want to retire before that enter that age.Current balance of $1000Annual rate of return of 8%Employer match 50%Employer match ends 6%View your report and answer the following questions:13. What will your total be if you retire at 65? What about 55?14. Read the definitions below. What was the Standard and Poor’s 500 average annual compounded rate of return between 1970 and 2012? The higher percent? The lowest?Now, review the following guide to 401Ks and answer the questions that follow: . What are the 4 types of defined contribution plans?16. How do defined contribution plans work?What are the tax benefits of 401ks?How do 401k investments affect your take home pay?If you need the money early, what is the penalty you will possibly pay? What are the exceptions for taking the money early? Overall, why is contributing to a 401k a good choice?The Third (Possible) Source of Income - Social SecuritySocial Security or FICA gets taken out of your paycheck every pay period. You have no choice in the matter. It was a program designed in the 1930s to provide an income for people when they retired from their job. Learn a bit about it… is the purpose of social security?What other ways does it help besides retirement income?Today, you hear on the news and read in the paper all the time that Social Security may not even be around when you get to the age of retirement. Why not? What’s going on? Read about the underlying problems. and explain in your own words the problems discussed.Finally, why should life expectancy, how much you save, and understanding retirement plans and social security matter to you? As of Aug. 2014 - 36% of American adults were not saving for retirement usually saying that because of cost of living expenses and income limitations they couldn’t afford to put money away. They also are relying heavily on Social Security and planning to work till much older than in previous decades.Ask your parents what kind of retirement plan they have…traditional pension, 401k, IRA, other? Record their answer here. If they are not yet saving for their retirement- ask them why. Use the information you learned here to write your investment reflection- be sure to include your plans for investing and your reasons for making that decision._________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________________ ................
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