| Course | GF590 Personal Financial Planning |
|---|---|
| Unit | Unit 8 |
| Paper type | Retirement need analysis |
| Length | About 890 words, 6 pages double-spaced |
| Format | APA 7 student paper |
| School | Purdue University Global |
| Program | MS in Finance |
| Updated | October 2026 |
Free sample paper for GF590 Unit 8
Pricing a Retirement Date: A Unit 8 Retirement Need Analysis for a Pharmacist and a Teacher
[Student Name]
Purdue University Global
GF590: Personal Financial Planning
Unit 8 Retirement Need Analysis
[Instructor Name]
[Date]
The household, its goals, benefits and balances are composite and illustrative; benefit amounts are estimates of the kind a statement would supply; the sources cited are real.
Assumptions
All figures are in today's dollars. Nominal returns of 6 percent before retirement and 4.5 percent after, with inflation of 2.5 percent, give real returns of 3.41 percent and 1.95 percent. The conversion is made once here and used throughout.
1. Spending. $100,000 a year of household spending in today's dollars plus about $12,000 of income tax, $112,000 in all. This is 55.2 percent of current gross pay, lower than a typical replacement ratio because the mortgage, childcare and college saving will be gone.
2. Health coverage before Medicare. About $9,000 a year for each spouse under 65, so $18,000 for five years while both are under 65 and $9,000 for three more while only the teacher is.
3. Teacher's pension. 1.8 percent times 33 years of service times a final average salary of $62,000, or $36,828 a year, beginning at once. The plan's cost-of-living adjustment is assumed to keep it level in real terms.
4. Pharmacist's Social Security. About $2,950 a month, $35,400 a year, from her 67th birthday, as her statement estimates.
5. Horizon. Thirty-eight years, until the teacher reaches 95.
6. Current saving. $10,662 a year: the pharmacist's 3 percent deferral, her employer's match of half that amount, and the teacher's 403(b) deferral.
The Income Map
Withdrawals change sharply over time, because the pension starts at once and Social Security seven years later.
1. Years 1 to 5. Need of $130,000 including health coverage, less the pension, leaves $93,172 a year to withdraw.
2. Years 6 and 7. Health coverage falls to $9,000, so withdrawals are $84,172.
3. Year 8. Social Security begins, and withdrawals fall to $48,772.
4. Years 9 to 38. Both spouses are on Medicare, and withdrawals settle at $39,772.
Early withdrawals are more than twice the later ones, so a single replacement ratio or a fixed withdrawal rate would misprice this household's retirement; the bridge years before Social Security carry most of the cost.
Capital Required
The capital required at retirement is the present value of all thirty-eight withdrawals at a real return of 1.95 percent, taken at the start of each year: about $1,425,642. A common shortcut, a 4 percent initial withdrawal rate, would suggest $2.33 million for a $93,172 first-year draw, overstating the need because it assumes the withdrawal never falls (Bengen, 1994).
Resources
Existing retirement balances of $239,500 grow at 3.41 percent real for nineteen years to about $453,277. Current saving of $10,662 a year adds about $278,708. Together the household would have about $731,985, a shortfall of about $693,658. Closing it would take about $2,211 a month more in today's dollars, more than double the household's entire recorded surplus.
The Dates Table
Because the shortfall is too large to close by saving alone, the analysis compares three retirement dates, each at current saving and at the plan's higher saving of $22,122 a year. The plan's figure adds the pharmacist's move to a 5 percent deferral, the larger match and $600 a month of new saving.
1. 60 and 57. Capital needed $1,425,642. Shortfall $693,658 at current saving and $394,089 at plan saving.
2. 62 and 59. Two more years of work raise the pension to $39,060 and bring Social Security closer. Capital needed falls to $1,231,528. Shortfall is $427,013 at current saving and only $83,326 at plan saving, which a return of about 6.3 percent nominal rather than 6 percent would close.
3. 65 and 62. Capital needed falls to $938,948. Current saving almost suffices, with a shortfall of $16,082; plan saving leaves a margin of about $399,595.
Two extra years of work help in three ways at once: more years of saving, more years of pension service and fewer years of withdrawals. Studies of retirement preparation find that working longer is among the most powerful adjustments available to a household that has saved less than its goal requires (Scholz et al., 2006).
What Could Change the Answer
A 2025 federal law, the Social Security Fairness Act, removed the offset that used to reduce spousal and survivor benefits for people with pensions from jobs outside Social Security (Social Security Administration, 2025). The teacher may therefore receive a spousal benefit on the pharmacist's record. It is not counted here until a benefit estimate confirms the amount, so it is an upside to the plan. On the other side, a capped pension adjustment, higher health costs before Medicare or lower returns would all raise the capital needed.
Recommendation
The analysis recommends planning for retirement at 62 and 59 with the plan's higher saving, and reviewing the 60 and 57 date in five years if returns and saving run ahead. That choice keeps the couple's original goal in view without building the plan on it. If the teacher's spousal benefit is confirmed, or if the pharmacist's income rises faster than inflation, the earlier date may come back within reach, and the annual review is the place to test it with fresh figures.
References
Bengen, W. P. (1994). Determining withdrawal rates using historical data. Journal of Financial Planning, 7(4), 171-180.
Scholz, J. K., Seshadri, A., & Khitatrakun, S. (2006). Are Americans saving "optimally" for retirement? Journal of Political Economy, 114(4), 607-643. https://doi.org/10.1086/506335
Social Security Administration. (2025). Social Security Fairness Act: Windfall Elimination Provision (WEP) and Government Pension Offset (GPO) update. https://www.ssa.gov/benefits/retirement/social-security-fairness-act.html
The Purdue Global GF590 Unit 8 instructions
Unit 8 of GF590 asks you to estimate what a couple needs to retire when they want and whether they are on track. State assumptions once: spending in today's dollars, taxes, health coverage before Medicare, pension formulas, Social Security estimates, returns before and after retirement and the horizon, converting nominal returns to real. Build need from expected spending rather than a replacement ratio when the household's costs will change. Map income year by year, since pensions and Social Security may start at different times. Compute the capital required as the present value of withdrawals, then compare it with the future value of existing balances and current saving. If the gap is large, compare alternative retirement dates and saving levels, and explain why later dates help. Note any rule changes that could raise or lower benefits. Cite retirement research in APA 7.
Inside the GF590 Unit 8 example
Six numbered assumptions open the analysis, including the 1.8 percent pension formula and Social Security at $2,950 a month from age 67. An income map shows withdrawals of $93,172 in the first five years, $84,172 in the next two, $48,772 in year eight and $39,772 afterward. The highlighted sentence explains why a single ratio would misprice this retirement. Capital required is $1,425,642, compared with the much larger figure a 4 percent rule would give, citing Bengen. Resources reach $731,985 at current saving. A dates table compares 60 and 57, 62 and 59, and 65 and 62 at current and plan saving, citing Scholz and colleagues on working longer. A section notes the spousal benefit the 2025 Fairness Act may allow, citing the Social Security Administration, and a recommendation closes.
Reading the GF590 Unit 8 grading rubric
The GF590 rubric for retirement analysis weights assumptions heavily, so a clear, sourced list with a single nominal-to-real conversion earns the first block of points. Graders then reward need built from spending, with the reason stated, and income mapped year by year rather than averaged. The capital calculation must discount actual withdrawals, and comparing it with a simple withdrawal rule shows understanding of why the shortcut fails. Instructors in the MS in Finance program value a dates table that turns a shortfall into choices, with each date's advantages explained. Noting rules that could change benefits, and treating unconfirmed amounts as upside, shows care. Bengen's withdrawal study serves as the foil, Scholz and coauthors support the case for working longer, and the SSA notice dates the rule change.
GF590 Unit 8 help from the desk
The usual GF590 Unit 8 mistake is applying a 70 or 80 percent replacement ratio to a household whose mortgage, childcare and college costs will soon disappear. Others mix nominal and real figures, inflating one side of the comparison. Pensions and Social Security are averaged into one income stream, hiding the expensive early years before benefits begin. Health coverage before Medicare is forgotten. Shortfalls are reported without any options, leaving the couple with a number and no decision. Recent rule changes are ignored or counted without confirmation. If your household has different benefits, such as two Social Security records, a lump-sum pension or rental income, keep the order: sourced real assumptions, spending-based need, a year-by-year income map, capital required, resources, a dates table and the changes that could alter the result.
Get a GF590 Unit 8 example written to your instructions
If your section fixes return and inflation assumptions, they are used as given. Otherwise the ages, balances, pension or benefit estimates and target dates from the GF590 Unit 8 case, with the rubric, are enough for an analysis that builds need from spending, maps income as it starts and prices the wanted date against alternatives. Free for the first; within 24-48h. The paper above is an original model document written by our desk, not a submitted student paper and not an official Purdue University Global document.
More GF590 papers and MS in Finance samples
- GF590 Unit 1: Bonus Versus Mortgage Discussion Post
- GF590 Unit 2: First Meeting Interview Question Set
- GF590 Unit 3: Household Net Worth Statement
- GF590 Unit 4: Household Cash Flow and Reconciliation
- GF590 Unit 5: Household Risk Exposure Review
- GF590 Unit 6: Inheritance Versus Mortgage Reflection
- GF590 Unit 7: Two Child College Funding Calculation
- GF590 Unit 9: Investment Policy Statement
- GF590 Unit 10: Comprehensive Financial Plan
- GF585 Unit 8: Healthcare Pounds Trend Exercise
- GF584 Unit 8: Hedging and Borrowing Policy Extract
- GF583 Unit 8: Revolver or Paper Borrowing Comparison
- GF582 Unit 8: Deposit Pricing Regression Memo
GF590 Unit 8 questions, answered
Why not use a 70 or 80 percent replacement ratio?
Because it describes an average household, and this one will shed large costs, childcare, college saving and a mortgage, before retirement. The sample's spending-based need comes to 55.2 percent of current gross pay. A ratio is a reasonable cross-check, and the sample mentions it, but a plan built on it here would ask the couple to save for spending they will not have.
Where can I find a free GF590 Unit 8 sample paper?
A complete GF590 Unit 8 retirement need analysis is on this page, pricing retirement at 60 and 57 for a pharmacist and teacher, with an income map, capital required, a three-date table and APA 7 references.
Why are withdrawals so much higher in the first years?
The teacher's pension starts at once, but the pharmacist's Social Security does not begin until 67, seven years later, and both spouses need private health coverage before Medicare. Early withdrawals of $93,172 fall to $39,772 once those gaps close.
How much does retiring two years later help?
At the plan's higher saving, moving from 60 and 57 to 62 and 59 cuts the shortfall from about $394,089 to $83,326, because it adds two years of saving and pension service and removes two years of withdrawals.
Does the analysis count a spousal benefit for the teacher?
No. The 2025 Social Security Fairness Act may allow one by removing the old offset, but it is left out until a benefit estimate confirms the amount, so it is treated as an upside.