Question

Implement a retirement calculator using java

Required Features


Your app should compute a retirement dashboard, based on the retirement data entered by the user.
Retirement data must include:
1. the client’s name
2. the name of this scenario, i.e. this retirement configuration (e.g. Snowbird Plans)
3. current retirement nest egg ($)
4. average annual rate of return (e.g. nest egg is invested and grows at 4% per year)
5. current salary
6. yearly amount being contributed towards retirement (either as percentage of salary or as a
dollar amount that also grows with the next variable, the yearly salary increase [as % YoY])
7. estimated yearly salary increase (e.g. 2% yearly salary increase)
8. number of years to retirement (or current year vs year in which client wants to retire)
9. desired income at retirement for active years (e.g. from 65-80)
10. desired income at retirement after active years (e.g. less travel after age 80

Answer 1

A Java-based retirement calculator takes in various user inputs, like current savings, salary details, and retirement goals, to project future retirement savings using compound interest. It aims to determine the necessary savings for maintaining a comfortable lifestyle, typically 70-80% of pre-retirement income, through contributions and interest growth.

Step-by-step explanation:

Implementing a Retirement Calculator in Java

To implement a retirement calculator using Java, you should consider taking input from the user that includes their current retirement nest egg, average annual rate of return, current salary, yearly contributions towards retirement, estimated yearly salary increase, number of years to retirement, and desired income during active and post-active retirement years. Using this data, the retirement calculator will forecast the growth of the retirement savings over time, taking into account compound interest, salary changes, and contributions. The goal is to determine the size of the nest egg that will provide an adequate income during retirement, typically suggested as 70-80% of pre-retirement income.

An example scenario might involve contributing a percentage of one's salary towards retirement, such as 15% of income, a strategy recommended by economists for maintaining a comfortable lifestyle. This aligns with the goal of ensuring a retirement income that is about 70% of the pre-retirement salary. The key mechanism by which savings increase is compound interest, which can have a substantial effect on savings over long periods, as shown in Yelberton's case where saving $100,000 at a 6% interest rate compounds to $574,000 after 30 years.

For more accurate projections, the retirement calculator should also factor in factors such as inflation, changes in the cost of living, and adjustments to retirement plans like increasing retirement age or changing contribution strategies. Taking these into account will provide a more realistic and sustainable retirement plan.