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So how did it go? Check to see if you're using your calculator correctly and how Josh and Millicent are doing in their retirement planning.

First Set of Questions

1.Under the assumptions entered, at what age will your income be insufficient?
Answer: At age 81.

2.At that age, your pensions will cover what percentage of your expenses?
Answer: 13%

3.How many more years must you work to ensure the income will last?
Answer: 4, or until age 59.

Second Set of Questions

1.Under the assumptions entered, at what age will your income be insufficient?
Answer: Never. It is expected to last throughout retirement under the assumptions used.

2.Does the model project you will leave an estate to heirs?
Answer: Yes, one worth $2,218,181.

3.The calculator shows your 401(k) contribution as $500 per month and your employer's as $210 per month. How were those amounts determined?
Answer: Josh's contribution was $250 per pay period for 24 pay periods in the year. That's $250 times 24, or $6,000 for the year. $6,000 divided by 12 (months) is $500. Also, $6,000 is 14.29% of Josh's gross pay ($6,000 divided by $42,000). His employer will match that contribution dollar-for-dollar only up to 6% of pay, or $2,520 ($42,000 times 0.06). $2,520 divided by 12 is $210.