# Lump sum required

Can a $100,000 take care of retirement if I Choose the retirement amount and my retirement age (55) and using a discount rate of 6% will the $100,000 get me there? How big of a lump sum would I need? What are some other options to supplement the lump sum to get to me to choose my retirement savings amount?

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Can a $100,000 take care of retirement if I Choose the retirement amount and my retirement age (55) and using a discount rate of 6% will the $100,000 get me there? How big of a lump sum would I need? What are some other options to supplement the lump sum to get to me to choose my retirement savings amount?

Lump sum required will be Future value/(1+rate of interest)^duration

Rate of interest=6%, n= duration=30 years

=100000/(1+6%)^30

=$17411.01

Hence $17411 is required right now to make the amount of $100000 in 30 years.

What are some other options to supplement the lump sum to get to me to choose my retirement savings amount?

Some basics on retirement plan:

Various types of retirement plans are 401(k) plan and the traditional pension plan. As per the Employee Retirement Income Security Act (ERISA) covers two types of pension plans: defined benefit plans and defined contribution plans.

As per dol, "A defined benefit plan promises a specified monthly benefit at retirement. As per Investopedia "Defined benefit plan is an ...

#### Solution Summary

Response helps in calculating Lump sum required.