You are planning to save for retirement over the next 30 years. To do this, you will invest $700 a month in a stock account and $300 a month in a bond account. The return of the stock account is expected to be 11% APR compounded monthly, and the bond account pays an EAR of 6.5%.
When you retire, you will combine your money into an account that pays an EAR of 8%. How much can you withdraw each month from your account assuming a 25-year withdrawal period?
How much would you need to invest each month if your stock account is worth $2 million when you retire in 30 years if you earned a 9% annual return?