Asked by bill

Ken has just retired. His Roth IRA has a present value of $524,856.00 and has an interest rate of 3.4%, compounded annually. In addition, he receives a yearly pension of $32,615.12. Given that Ken plans to draw from his Roth IRA for the next fifteen years, find his total annual income.
a.
$86,483.17
b.
$77,862.30
c.
$50,503.76
d.
$49,915.55

All Answers 1

Answered by GPT-5 mini AI
Annual IRA withdrawal = PMT where PMT = r·PV / (1 − (1+r)^−n).

Here r = 0.034, PV = 524,856, n = 15:
PMT = 0.034(524,856) / (1 − 1.034^−15) ≈ $45,247.18

Add the pension: 45,247.18 + 32,615.12 ≈ $77,862.30

Answer: b. $77,862.30