Dear Sir/Madam,This is the course from Master degree, : Money Managment. The assesment topic...

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Dear Sir/Madam,This is the course from Master degree, : Money Managment. The assesment topic is:Suppose you have reached retirement. You have saved a goodmount of money, say EUR 500,000, but, if you wish to take acurrency and and an amount more realistic for your country,please do so.You are now to make a comparison between two approaches tousing your wealth to see you through retirement:A. Establish what yearly pension a life insurance company isprepared to pay you for the rest of your life.B. You manage your wealth yourself. Set an amount you want towithdraw each year, and estimate what percent you can earn onthe outstanding balance.All you numbers should be realistic for you and your countryand your situation.Do stick to my simplifying conventions about the tablereflecting end-year movements and balances, and have a yearzero.Share AnalysisChoose two companies from “Morningstar”. One should be acompany you might like to invest in and the other one you wouldavoid.Using the data on the Morningstar database available in thelibrary, explain the signification of the various financialratios related to the two companies you have chosen (e.g.Price/Earnings, Price/Book, Price/Sales, Price/Cash Flow,Dividend %).Prepare a brief description of each company and explain why.What`s your comment?Regards,Sandra

Robert · Accepted Answer

Retirement Management 
Retirement management is essential for an individual to have a secured and a stress free 
life after one decides to retire. It is important for all people to plan their retirement according to 
their needs and necessities. For the purpose of this assignment let as assume that the person 
resides in Europe and has saved 500,000Euros for his retirement and is expected to live for 
another 30 years. His annual expenditure is say 25,000Euros.
In order to have a stress free life he should choose a yearly life insurance pension plan 
which provides a yearly withdrawal of 25,000Euros. Let us assume a plan which provides 7% 
Payout Schedule
Years
Interest
Earned
Payout
(Withdrawal) Balance
Cumulative 
Interest
0 0.00 0.00 5,00,000.00 0.00
1 25,000.00 25,822.37 4,99,177.63 25,000.00
2 24,958.88 26,338.81 4,97,797.70 49,958.88
3 24,889.89 26,865.59 4,95,822.00 74,848.77
4 24,791.10 27,402.90 4,93,210.20 99,639.87
5 24,660.51 27,950.96 4,89,919.75 1,24,300.38
6 24,495.99 28,509.98 4,85,905.76 1,48,796.36
7 24,295.29 29,080.18 4,81,120.87 1,73,091.65
8 24,056.04 29,661.78 4,75,515.13 1,97,147.70
9 23,775.76 30,255.02 4,69,035.87 2,20,923.45
10 23,451.79 30,860.12 4,61,627.54 2,44,375.25
11 23,081.38 31,477.32 4,53,231.60 2,67,456.62
12 22,661.58 32,106.87 4,43,786.31 2,90,118.20
13 22,189.32 32,749.00 4,33,226.63 3,12,307.52
14 21,661.33 33,403.98 4,21,483.97 3,33,968.85
15 21,074.20 34,072.06 4,08,486.11 3,55,043.05
16 20,424.31 34,753.50 3,94,156.91 3,75,467.35
17 19,707.85 35,448.57 3,78,416.18 3,95,175.20
18 18,920.81 36,157.55 3,61,179.44 4,14,096.01
19 18,058.97 36,880.70 3,42,357.72 4,32,154.98
20 17,117.89 37,618.31 3,21,857.29 4,49,272.87
21 16,092.86 38,370.68 2,99,579.48 4,65,365.73
22 14,978.97 39,138.09 2,75,420.37 4,80,344.71
23 13,771.02 39,920.85 2,49,270.53 4,94,115.72
24 12,463.53 40,719.27 2,21,014.79 5,06,579.25
25 11,050.74 41,533.66 1,90,531.87 5,17,629.99
26 9,526.59 42,364.33 1,57,694.14 5,27,156.58
27 7,884.71 43,211.61 1,22,367.23 5,35,041.

Dear Sir/Madam, This is the course from Master degree, : Money Managment. The assesment topic is: Suppose you have reached retirement. You have saved a good mount of money, say EUR 500,000, but, if...

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