Managerial Report

MANAGERIAL REPORT OUTLINE

TO: Dr. Stuart Monroe

FROM:

DATE: November 20, 2014

SUBJECT: Term Project CIS 3320 Managerial Science Fall 2014

Problem Statement

Using a deterministic model I intend to find the approximate age that I would have enough money in savings to retire and live comfortably until I die. I would like to determine how much that I would require to save annually and how much that i would have in my retirement portfolio when I decide to retire, and approximately at what age that I may pass and if I have enough to live comfortably until that age.

1. Using the deterministic model that was given to me I imputed the data that was relevant to my situation. I am 47 years old now and I researched the approximate salary for Accountants in Colorado, which is the occupation that I will have upon completion of my education. The average starting salary for an accountant is $56,000 annually. I currently have $3000 in my portfolio. This information along with the equations given to me i was able to deduce that I am quite possibly in big trouble.

Using the percentages that were given I concluded that I would have approximately $188,000 in my portfolio when I reach the retirement age of 65. I do not however expect that I would retire that early. My expectation is that I will work probably until probably closer to 73. At age 73 I would have approximately $480,000 in my portfolio. Closer to an amount that is realistic to retire with, however still not keeping me comfortable for as long as I am expected to live.

2. Making the change from 4% to 8% annual investment to my portfolio made some drastic changes in the output. At age 73, the age that I currently expect to retire, I would have $920,000 in my portfolio. This is a huge difference and would allow me to live comfortably until the age of 81 whereas I will be broke. This poses a problem since the age estimator gave me an approximate death age of 88 years old.

3. Some...